When the question of filing bankruptcy comes to light, you don’t want to decide for or against this until you are aware of all the benefits and drawbacks. This includes the impact it will have on your credit report and score.
If you decide to move forward with any type of bankruptcy filing, it is important to know how long it will stay on your credit report. This will give you a clear understanding of what to expect in the years to come.
In short, a bankruptcy is a damaging event that will remain on your credit report for an extended period of time. That being said, it is nothing you are unable to recover from.
What you need to Know
If you file for Chapter 7 bankruptcy, it will remain on your credit report for 10 years from the filing date.
If you file for Chapter 13 bankruptcy, it can also remain on your credit report for up to 10 years from the filing date although it is only supposed to be on your record for 7 years.
Either way, as you can see, the bankruptcy is going to have an impact on your credit report and score for an extended period of time.
In addition to the bankruptcy itself, there are other ways that this can have a negative impact on your credit report, such as a penalty for having a large number of serious delinquencies (which led to the filing in the first place).
The Recovery Process
As easy as it is to believe there is nothing you can do to recover from a bankruptcy filing, nothing could be further from the truth.
When you file bankruptcy, while it can damage your credit score, it allows you to re-establish yourself and to rebuild your credit and build up your credit score over time There is no way around this. What you need to realize, however, is that you can build up your score over time.
Your credit score will improve, as long as you are doing things the way you should, such as paying all your debts on time.
A bankruptcy will stay on your credit report 10 years for Chapter 7 and 7-10 years for a Chapter 13. This may not be something you want to deal with, but don’t let it stop you from filing. With the right approach after your bankruptcy case, you can improve your credit score and rebuild your credit.