Beyond Bankruptcy

 It’s been a few years now since the bankruptcy and it was the best thing we could have done to have gotten out of the hole we were in. To start anew with a fresh, clean slate has been awesome. We got to take what we learned and apply it, understand how it all works and move on from there.

It was not easy at first as the stigma of it can really stick in your craw like it does with me. But, we are human, we make mistakes and it’s okay. You have to forgive yourself. It’s what we do with those mistakes that counts, how we learn and move on, get better, improve, that’s what matters most.

In order to improve the credit scores, we had to get a new credit card. I know that seems contradictory to go into debt to make your credit scores higher, but yes, that’s the case. The reason why is to show you can handle your bills again, you can handle debt. This is so that future creditors will be able to see that and trust to lend you money again.

What to choose? Well, first is the type of card. No store cards that we really wouldn’t use anyway. I had one just before the bankruptcy with Pier 1. I loved them greatly and shopped there a lot until they went out of business and closed their physical brick and mortar store. You can still buy from them but it’s all online now. So sad! They also got rid of their credit card. So much for that! Once the balance was paid in full, they closed the account. Rats! 

Pier 1: https://www.pier1.com/

We looked at a few but chose Care Credit as I had good experience with them. They have no annual fee which is super important. The interest is high but only when you keep a balance as they do have a special interest free program for when you charge a certain amount you get so many months free of interest so long as you pay it off by a certain time. This is a promotional program that I love! So when you charge on it a good amount say $1,000 or a few hundred, the entity you are paying will place the promotional time frame on there. When you get your statement afterwards, you can see what the date is that you have to pay it back. This is super important because if you don’t pay the balance by that time, you will get charged ALL that back interest they didn’t charge you. Ouch! Yep, they do keep track of it. 

Why is this a good thing? Because it makes you pay that balance off. What I do is figure out how much a month I have to pay before that time is up. Subtract the last month and add on that amount to the other payments. Then you know you will easily pay it off before the promotional time ends. 

Sometimes I’ll just pay extra or double it so I can pay it off rather quickly. Each pay day when you have a little extra, just send it on over! You don’t want to cut it too close cause you have to allow for processing time on their end.

We chose Care Credit because let’s face it, dental insurance is not good. You never have enough coverage when it comes to the dentist. Then as I just explained, they do those promotional interest free time periods and so it keeps us in check as the interest rate is high. No annual fee is great as well.

I used my online bank to set it up, adding Care Credit to the Pay Bills area and then I can schedule payments when I want them to go and how much and I can edit as need be. Then the bank will send the amount you chose and from which acct and going to who you selected to pay. All done for you at no extra cost. Brilliant!

Recently, our banker we’ve been talking to suggested we get one more card to use for more general purposes and just charge it, then pay it off again next pay period. Keep doing that and it would also improve our credit score.

Believe it or not, the scores bounced back from the bankruptcy very quickly. Up to high 600s and then right into the 700s! How awesome! Now most likely it’s cause we kept paying the house payments on time and more than required and then paid off the Jeep. Boom!

It was surprisingly easy to not have a credit card. Only the debit. It made life very simple and easy. Definitely a great feeling!