According to a report from Lending Tree, California residents who file for bankruptcy may be able to rebound from it relatively quickly. The report indicates that about 40 percent of Americans have a credit score of 640 within a year of filing. That improves to 65 percent within three years of filing. Having a good credit score is one of the most important attributes to have when applying for a mortgage after a bankruptcy.

Those who had a credit score of at least 720 three years after bankruptcy were offered home loans at rates similar to those who hadn’t filed. The key to repairing a credit score after bankruptcy is to have a plan. Part of it should be to obtain gas or retail credit cards that are easy to repay. In fact, it may be beneficial to apply for credit cards and not use them at all.

Creating a budget and amassing an emergency fund can help a person after a bankruptcy. This can help to control spending and allow a person to rely less on a credit card. Ideally, individuals who have filed in the past will use debit cards instead of credit cards to fulfill their future spending needs. Paying bills on time is also an important part of rebuilding credit after bankruptcy.

Those who are looking for debt relief may benefit from filing for Chapter 7 protection. Doing so may allow a person to have credit card debt discharged in a matter of weeks or months, and it may be easier to build an emergency fund or save for a down payment on a home or car. An attorney may explain the other benefits of filing such as an automatic stay of creditor collection activities.