It is important to understand that not all bankruptcy filings are treated the same when it comes to your credit score. The impact of bankruptcy on your credit rating is one of the biggest concerns many clients have. For many debtors, the damage caused by a bankruptcy filing is minimal because their credit score is already low due to negative payment history, asset seizures, lawsuits and garnishments. Even the lowering of your credit score is worth it for most people when compared to the amount of debt they are able to discharge and eliminate in their filing.
If you file for debt relief under Chapter 7, the bankruptcy notation will remain on your credit report for ten years from the date you file your case. A Chapter 13 filing will only be noted on your credit file for seven years from your petition date. The theory behind the shorter time frame for Chapter 13 is due to the fact that Chapter 13 debtors repay a portion of their debt, so their credit score tends to be less affected than a Chapter 7 debtor’s score.
There are many other factors that should be considered when deciding whether to file a Chapter 7 or Chapter 13 case, including:
The personal bankruptcy process can be simple and effortless if you retain an attorney who will explain the steps to you. Ms. Anderson is dedicated to walking you through each step, explaining the process along the way. At The Law Office of Diane Anderson, we are determined to help our clients obtain the best results possible.