Credit score - will filing for bankruptcy chapter 13 lower my credit score

Your credit score will be effected by filing for bankruptcy, question is by how much. Consider that your credit rating might already have suffered somewhat if you already are behind paying some bills or maybe stopped paying at all. A credit score takes quite a long time to repair and if you keep getting negative entries into your credit report over a long period of time, your score is dropping and will not significantly improve until there is an end to the bad reports. There is no point trying to improve your score in one area while it gets knocked down in another area.

What happens to your credit score when filing bankruptcy

Video - What happens to your credit score when filing bankruptcy.

How Does Bankruptcy Affect a Credit Score

Video - How Does Bankruptcy Affect a Credit Score.





To get a better credit score you must pay your bills on time and over a long period of time, maybe something you will only be able to do once you have sorted out your finances. One way of doing this, if you truly are in bad position financially, is to file for bankruptcy. Filing will ruin your credit score, at least temporarily but you might find that you will be able to get credit shortly after coming out of your bankruptcy. The reason for this is of course that you have less debt and hopefully better organized to pay your bills. This is something many creditors take into consideration before giving credit to you for buying a car or other items like furniture.

Credit bureaus can report your bankruptcy for up to 10 years and will likely do so if you filed for chapter 7, and around 7 years if you filed for chapter 13. Every time you need credit during this time, your creditor might factor in your bankruptcy and you might have to pay a premium in the form of a larger interest rate. Over time, though, your credit score will rise as long as you keep paying your bills on time.