Just the word bankruptcy can send a shiver down the spine and evoke pictures of paupers being shoved through the doors of a debtors prison. We are fortunate no to live in those times, and fortunate that rebuilding credit after bankruptcy is not as difficult as some people might think it is.

There is a misconception that because the record of your bankruptcy filing remains on your credit report for seven to ten years that you will not be able to get any type of credit during that whole time.

However, that is not the case at all. Actually, many lenders will accept a an application for credit from you the very day that your bankruptcy is discharged (the legal term that means it is final and your debts have been cleared). Now, that doesn't mean you should run out and apply for every loan and credit card you can get your hand on, and it doesn't guarantee that you will be approved.

What it does mean is that bankruptcy can become an opportunity for you to start over with a clean slate and to learn from your mistakes. While going through a bankruptcy may seem devastating at the time you are going through it, many people claim that it was the best thing that could have happened because it forced them to reevaluate how they were managing their money, and their lives, and in the end many say they came out in stronger financial positions than where they might have been if they didn't go through bankruptcy.

That should not be seen a encouragement to take such a drastic step, only as some bit of assurance that rebuilding credit after bankruptcy is possible to restore your credit, and possibly make it even better, after declaring bankruptcy.

The next question is, how do you start to rebuild credit after bankruptcy? For people who are able to reaffirm a loan that they had secured against their home or automobile, it starts with being sure that payments are made right on time every month, and making sure that before they try to take on any additional debt that they have those payments firmly under control.

However, if you have no loan still active after the bankruptcy, you will have to find a lender who is willing to be the first to give you a chance. That means you will probably need to look for a loan that is secured with either property you own or are trying to buy, and it is very likely you will pay higher interest rates for it.

If that is not possible, then a secured credit card could be a good option. This allows you to make a deposit with a bank and then you are allowed a credit line equal to your deposit, which you cannot withdraw while your card is still secured by it. This arrangement will cost some in fees the that lender imposes, but it will give you a chance to put some new, positive, history into your credit report.

The most important key to rebuilding credit after bankruptcy is being mindful of the commitments you are making with the companies that are willing to lend you money, to be sure you set a firm budget for yourself, and that you make all your payments on time. If you take such measured steps you will be able to have a good credit score again within two or three years and you will have acquired new financial management skills along the way.