Sometimes bankruptcy is the best option for your financial health. Unfortunately, filing for Chapter 7 comes with some side effects. For instance, you will take a significant hit on your credit score.

However, this does not have to be a permanent situation. The effects of Chapter 7 on your credit score last for 10 years, according to TransUnion. So, if you do nothing, your score will eventually improve. In the meantime, though, there are some methods you should consider to increase your score.

Monitor your credit

Your credit score might drop by 200 points or more after filing for bankruptcy. Your first step towards improving your score is to keep consistent tabs on your credit activity. Watch out for suspicious activity and check if your discharged credit accurately reflects your credit usage.

Avoid credit cards

Not everyone can avoid using credit cards, but it is a good idea to severely limit your credit card use after filing for Chapter 7. If you must use a credit card, try to pay off your monthly balance to avoid increasing your credit usage.

Take out secure loans

A credit builder loan is another good way to improve your score. Lenders hold the “loaned” money in a savings account until you pay off the balance. At the end of the payment schedule, you receive your money back and enjoy the benefits of an improved credit score.

The finance world offers many possibilities for people to improve their credit. No one’s credit has damage beyond repair. Consider improving your score and take action before settling for a lower credit score.