Ask a Lawyer - Archive

It has been almost 5 years since I paid off all of my bad debts which were charge offs at the time. I need to try and reestablish my credit. When I try to apply for credit I am constantly getting turned down. How do you reestablish credit if no one will give you credit? I live in DC. I don't know how long before all of those bad debts fall off my credit report. I heard 7 years; if that's true maybe I should just wait out the 2 years before trying to re-establish my credit then all of those old bad debts will be deleted, fall off or are removed.

Kudos to you for covering that written off debt! I wish all of my clients would follow suit:)

It is true that time will heal this wound, but in the meantime, I do have a few suggestions for re-establishing credit. Of course, once you get a card, YOU MUST PAY IT IN FULL EACH MONTH. Don't run a balance and get underwater again!

1. Apply for any credit card for which you get a solicitation in the mail and for which there is NO fee. I have a family member who filed bankruptcy twice and still got (and accepted) these solicitations. I know we're in a credit crunch, but give it a try.
2. Apply for credit at stores where you shop. I don't think I buy a thing over $20 without being asked to apply for a store credit card. These are usually fee-free, and stores encourage them as a way to draw you into shopping with them.
3. Sit down and talk with your banker or a credit union. Many banks and credit unions offer cards that work like credit cards and allow you to re-establish your credit. Maybe they have one tied to your savings which protects the bank while still giving you the benefit of the card.

I don't know the particulars of all of the products out there, but I know that there are several. Just be cautious about paying application or in advance for a card. These are probably scams.

Also, while I'm no credit scorer, you can also improve your credit by paying all of your other obligations timely, like your mortgage or rent and your car payment.

Best of luck to you!