In the 12-year span from October 1, 2005 to September 30, 2017, about 12.8 million consumer bankruptcy petitions were filed in the federal courts of the United States.
This is a lot of people to get away from bankruptcy without anywhere to go. Perhaps you feel you need to file for bankruptcy but worry about how long it stays on your credit report.
Fortunately, we made a helpful guide to answer all of your questions about filing for bankruptcy and how it will affect your credit score so keep reading!
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How Long Does Bankruptcy Stay On Your Credit Report?
If you are considering filing for bankruptcy, you might be thinking on how long it will stay on your credit report. The answer is that it depends on the type of bankruptcy you file.
It will take 10 years for a Chapter 7 bankruptcy to stay on your credit report while 7 years for a Chapter 13 bankruptcy. However, bankruptcy is not the end of the world, and you can still rebuild your credit after filing for bankruptcy.
Before you file for bankruptcy, you should consult with a professional like a Chapter 7 Bankruptcy attorney to discuss your options and determine if bankruptcy is the right choice for you.
How Does Bankruptcy Affect Your Credit?
Once you have filed for bankruptcy, it will stay on your credit report. This can make it difficult to obtain new credit during that time.
However, it is important to know that bankruptcy does not affect your credit score as much as other factors, such as late payments or high balances.
Therefore, if you are able to keep your credit score high, you may still be able to qualify for new credit after bankruptcy.
Types of Bankruptcy
The most common types of bankruptcy are Chapter 7 and Chapter 13.
Chapter 7 Bankruptcy
This is for individuals who do not have the ability to repay their debts and can have most of their debts discharged.
Chapter 13 Bankruptcy
This is for individuals who have a regular income and can repay their debts over time through a repayment plan.
Once you have decided which type of bankruptcy you will be filing for, the next step is to begin the actual bankruptcy process.
What Are the Requirements for Filing for Bankruptcy?
The requirements for filing for bankruptcy vary by state, but most states require you to file a petition with the court, pay a filing fee, and complete credit counseling.
You will also need to provide financial information to the court, including a list of your creditors, your assets, and your income.
When to File for Bankruptcy
Filing for bankruptcy is often the best course of action for those who are struggling to pay their debts.
There are a few things to keep in mind when considering bankruptcy, such as whether or not you qualify, what type of bankruptcy you should file for, and what the process will entail.
Generally, bankruptcy will stay on your credit report for seven to ten years. However, this does not mean that you will not be able to get credit during this time. If you need help, there are many resources available to assist you.
We have some helpful resources, check the rest of our blog for more!