Losing your home to foreclosure is a very difficult thing to go through, and it can play havoc not only with your current credit report, but your future credit options as well. Trying to get credit after foreclosure can be daunting if you do not have a plan, and stick to it. Your financial world is already in turmoil, so you can not afford to make the same credit mistakes that you have made in the past. You must get a plan in place, stick to it, and change the habits that sent you into foreclosure in the first place.
The first step to gettting credit after foreclosure is to fix your budget. If you experienced foreclosure, then bad spending habits surely played some part in the problem. Trying to get credit after foreclosure without adjusting your spending will lead you right back to where you are now. Sit down with your spouse and document your spending down to the penny for a couple of months. Once you have this data in front of you, then it is easy to see where you are wasting your money. Write out a budget that accounts for every single bill first, as well as a small savings for emergencies. That way, when you are short you have something to draw on. Then decide on your expendable income. If there is none, then so be it.
Now that you have an idea about your finances, it is time to go and get some credit counseling. Professional advice is the number one step to getting credit after foreclosure, because they can look at your own unique financial situation and determine the best road. Go talk to a professional credit counselor before you even think about attempting to get credit after foreclosure.
The next step in getting credit after foreclosure is to slow down and realize that it takes time to do it right. If you try to run right out and get financing, chances are you will either find a loan that is loaded with high rates and terms, or no financing at all. Slow down, and take the time needed to rebuild your credit the right way. Again, this is where professional credit counseling comes into play. They can direct you on how long you should wait before attempting to get financed again.
Another key step in getting credit after foreclosure is to start small with a revolving balance card. A Sears card, Home Depot card, or other similar type card can help you to get back on track. Make small purchases on this card, and keep your payments perfectly on time. Continue to do this over a period of time that your credit counselor will inform you of, and you will slowly begin to rebuild your credit rating.
Avoid making large credit purchases such as home loans and car notes. These credit purchases are almost certain to be loaded with high rates and interest. Give your foreclosure a bit of time to get in the rearview mirror before considering such large purchase.
Repairing your credit is not an easy thing to do, but it is possible with some help and dedication to your financial outlook. Take the time to realize why you lost your home in the first place, and do not make the same mistakes again. You can get credit after foreclosure if you do these things.