We can all agree that the bankruptcy process can be a financially turbulent time, but once the debt has been discharged you are then free to begin the work of steering your finances in the right direction and starting the process of restoring your credit.

Depending on the type of bankruptcy you file, Chapter 7 or Chapter 13, a bankruptcy can stay on your credit reports for up to 10 years.  However, per Ruth Susswein, Deputy Director of National Priorities at Consumer Action, your credit could begin to rebound long before that point.

Here are five ways to help the rebuilding of your credit after bankruptcy.

1.  Check your credit reports regularly for errors

Credit reports are not perfect.  In fact, in a 2012 Federal Trade Commission study about 25% of U.S. consumers were able to identify errors on their credit reports that might have affected their scores.  Checking your reports regularly can help you to find and dispute any errors that could adversely affect your credit.

After your bankruptcy is complete, make sure –

• The accounts that were discharged in bankruptcy are reported as “discharged.”
• The discharged accounts have a $0 balance.
• The bankruptcy filing date is correct. Remember, the bankruptcy remains on your account for up to 10 years, so accuracy is extremely important here.

Immediately dispute any errors you find.

2.  Consider a secured or retail credit card

Bankruptcy can injure your purchasing power, but it should not destroy it entirely.  You may still qualify for certain types of cards.

Secured cards

A Secured credit card requires an upfront deposit of funds, which helps to protect the lender in case you are unable to make payments.  In exchange, you will get a credit limit that is typically equal to the amount of your deposit.

A word of warning here – read the fine print.  Some cards will not approve your application until your bankruptcy has been resolved.

Retail cards

Retail cards may come in handy as well post-bankruptcy.  They can have less strenuous credit requirements than other unsecured cards but watch out – many of these types of cards carry high interest rates and penalty fees.

The basic credit-building goals apply with either type of card:

• Do not take out more credit than you need.
• Make your required payments on time.
• Keep your balances low.

The setting up of automatic monthly payments and balance alerts will help you to meet your goals.

3.  Consider a credit-builder or secured loan

A traditional credit-builder is designed to help an individual build credit and works a bit differently from other types of loans.

Instead of getting the money upfront, the lender puts the loan proceeds into a savings account until all loan payments have been made.  At the end of the loan term, you can withdraw the cash – and if you have made on-time payments, you will likely help your credit.

Note that the term “credit-builder loan” can have more than one meaning, so it is highly advised that your make sure you understand the type of loan you are applying for before you commit yourself.

You might also want to look at obtaining a secured loan.  Secured loans are backed by collateral, like funds in a savings account or another type of asset, which can be turned over to the lender if you are unable to repay the loan.  These loans could be better options if a secured or retail card might tempt you to overspend.  However, make sure that you can afford the interest rate, fees, and monthly payments on the loan before applying.

4.  Ask for payments to be reported to the consumer credit bureaus

If you are making on-time rent or utility payments every month, then why not let them boost your credit?

Ask your landlord or utility company to report your monthly payments to the three major consumer credit bureaus – Equifax, Experian, and TransUnion – or check out companies like Experian Boost, PaymentReport, CreditMyRent, LevelCredit, RentalKharma, and RentReporters to help take care of the reporting for you.

5.  Become an authorized user on an account

This means that someone else – generally a close friend or relative – adds you to their credit card account.  Your credit can benefit from their positive account history and on-time payments, and your own preexisting credit history will not hurt theirs.  You will be issued a credit card in your name, but you are not legally responsible for paying it off.

The flip side?  Your credit could be further impacted and further reduced as a result of any bad credit decisions made by the primary account holder, and you may find it difficult to get removed from the account.  You should consider this credit-building method only if you trust the person to be responsible with the account.

Bottom line

It may not seem like it but rebuilding your credit after bankruptcy is possible.  Consider some steps we have listed to help to get you started.

Monitor your credit reports, use a secured card responsibly, consider a secured or credit-builder loan, look into getting your payments reported to the consumer credit bureaus or become an authorized user.

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