Is My Credit Affected if I File Bankruptcy?

If you have insurmountable debt and have had immeasurable difficulty paying back your creditors, you might want to consider bankruptcy. However, it’s important to know that this is an avenue that should only be taken when all other attempts to pay back your debt have failed. Equally important, you should understand how filing bankruptcy can affect your credit.

Generally speaking, depending on whether you file Chapter 7 or Chapter 13 bankruptcy, you can expect your credit score to lower from between 160 and 220 points. In other words, if your credit is currently only in the good range, your credit score will decrease to the point of being either only fair or even poor. As a result of this negative aspect of filing for bankruptcy, you may experience difficulty qualifying for new credit or a major loan for a home or car.

Chapter 7 Bankruptcy

Once you have completed a Chapter 7 bankruptcy, it can remain on your credit report for as long as a decade. Debts are discharged after only a few months after filing, which means they may actually vanish from your credit report after seven years.

Chapter 13 Bankruptcy

If you file for Chapter 13 bankruptcy, you can expect it to remain on your credit report for seven years. However, since debts are active in this type of bankruptcy for three to five years as a result of repayment plans that last as long, the bankruptcy may stay on your credit report even longer.

Overall, it’s worth noting that the older the debts listed with your bankruptcy are, the less impact they have on your credit score.

If you reside in the New York City area and are concerned about the effects of bankruptcy on your credit report and are considering filing, you need the assistance of skilled Brooklyn NY bankruptcy lawyers. Ursulova Law Offices is a bankruptcy law firm in Brighton Beach that can help. Contact bankruptcy law firm in Brighton Beach Ursulova Law Offices at your earliest convenience to discuss your case with Brooklyn NY bankruptcy lawyers.