This is one of the biggest myths and misunderstandings with credit. When you file bankruptcy you are telling the court that you do not have enough money to pay your bills. Since you do not have enough money to pay your bills, you will have to include EVERYTHING in the bankruptcy and in return, you can wipe away your debt and stop the collection calls. If you file a Chapter 7, then your debt is wiped away. If you file a Chapter 13, then you set up a payment program to pay a percentage of the money back to your creditors over the next 3-5 years. The debt may be gone or maybe lowered dramatically and put in a payment plan and the creditor calls will stop, but remember the Bankruptcy, as well as all of the creditors included in the bankruptcy, will report on your credit report. All of your creditors (even positive accounts) will now report as Included in Bankruptcy, which reports in the same category as Charge-off or Collection accounts. So, your debt may have been wiped away but you usually end up with an even lower credit score in its place.
Bankruptcy is not the end of the world. A bankruptcy does report for 10 years but sometimes it is the only way out. As a consumer, you need to focus on rebuilding your credit after you file bankruptcy. In the last several years a lot of credit companies have changed their approval process and will approve consumers for credit after a bankruptcy. That is great news, so you can start rebuilding your credit, but start small.
After filing bankruptcy you want to check your credit reports as well and make sure that all of your creditors are reporting accurately. It is very common for creditors that are included in the bankruptcy to report the account as charge-off that is inaccurate information that can damage your credit score, so you need to get all information reporting inaccurately fixed. That is why Better Day Consulting is here!
If you have any of these errors or have any questions about a bankruptcy you filed and how it is reporting, give Better Day Consulting a call. Our Case Analysts would be happy to review your credit reports with you and make sure everything is reporting accurately. Call us at 833-522-0200 for your FREE Credit Consultation. During your free credit consultation, we will also help you order your credit reports so we know exactly what is going on with your case.
Better Day Consultanting, The fastest growing credit repair firm in the U.S. Call now: 833-522-0200 www.betterdayconsulting.com