When you are going through a bankruptcy, just getting through the process can be overwhelming. However, if you have filed for bankruptcy, it is important to remember that you still need to begin rebuilding a strong credit rating. Your financial future depends upon it.
For debtors who have filed a Chapter 7 bankruptcy, it is important to note that this will remain on your credit report for 10 years. The amount of debt and type of debt will not be listed on the credit report; rather it will state that the debt's have been "discharged in a Chapter 7 bankruptcy."
Chapter 13 bankruptcies take longer to remove from one's credit report. The actual bankruptcy itself stays on for only seven years. However, this seven-year period does not officially begin until the debtor completes a Chapter 13 payment plan. Following through on this plan usually takes about five years. So if you have filed a Chapter 13 bankruptcy, it takes about 12 years to have it removed from your credit report.
Even though, bankruptcy is listed on a credit report for many years, the debtor can still begin to rebuild their credit. The first step is to obtain a secured credit card and be careful to pay off the balance every month. Secured cards usually have a yearly fee of about $30 and require that the holder deposit cash up to the credit limit of the card.
While this may not really seem like a credit card, and may appear to be a bit of a hassle, the secured credit card will appear on your credit report as any other type of credit card. Making on-time payments and not having a balance on this secured card will have a positive impact on your credit report. In fact, you may see an improvement in your credit score in as little as six months. Non-secured cards can be applied for about a year after filing for bankruptcy if your credit score improves. In addition, if the filer qualifies for a car loan or perhaps a furniture loan and continues to make on-time payments, the credit score will continue to improve.
Typically, within two to three years, a bankruptcy filer who takes steps to rebuild his credit will have a score around 650 to 680. As negative credit history, (like late payments and charged off accounts) begin to drop off his credit, the score will increase even more.
It is good to keep in mind that credit reporting agencies focus on the most recent credit history, within the last three to five years. When you establish positive credit history and continue to maintain it, your score will continue to get stronger. Make sure you check your credit report each year to see that there are no errors. If errors are found, be sure to contact the credit reporting agency and rectify the situation.
If you have filed for bankruptcy and also have a foreclosure on your credit, obtaining another mortgage can be very difficult. The foreclosure will stay on a credit report for seven years. Despite this, if the debtor continues to improve the credit score, this foreclosure won't have as much impact if the filer wishes to apply for a new mortgage. A bankruptcy filer with a foreclosure may qualify for a new mortgage in about three to four years, provided that it has been at least two years since filing for bankruptcy.
For debtors who have filed a Chapter 7 bankruptcy, it is important to note that this will remain on your credit report for 10 years. The amount of debt and type of debt will not be listed on the credit report; rather it will state that the debt's have been "discharged in a Chapter 7 bankruptcy."
Chapter 13 bankruptcies take longer to remove from one's credit report. The actual bankruptcy itself stays on for only seven years. However, this seven-year period does not officially begin until the debtor completes a Chapter 13 payment plan. Following through on this plan usually takes about five years. So if you have filed a Chapter 13 bankruptcy, it takes about 12 years to have it removed from your credit report.
Even though, bankruptcy is listed on a credit report for many years, the debtor can still begin to rebuild their credit. The first step is to obtain a secured credit card and be careful to pay off the balance every month. Secured cards usually have a yearly fee of about $30 and require that the holder deposit cash up to the credit limit of the card.
While this may not really seem like a credit card, and may appear to be a bit of a hassle, the secured credit card will appear on your credit report as any other type of credit card. Making on-time payments and not having a balance on this secured card will have a positive impact on your credit report. In fact, you may see an improvement in your credit score in as little as six months. Non-secured cards can be applied for about a year after filing for bankruptcy if your credit score improves. In addition, if the filer qualifies for a car loan or perhaps a furniture loan and continues to make on-time payments, the credit score will continue to improve.
Typically, within two to three years, a bankruptcy filer who takes steps to rebuild his credit will have a score around 650 to 680. As negative credit history, (like late payments and charged off accounts) begin to drop off his credit, the score will increase even more.
It is good to keep in mind that credit reporting agencies focus on the most recent credit history, within the last three to five years. When you establish positive credit history and continue to maintain it, your score will continue to get stronger. Make sure you check your credit report each year to see that there are no errors. If errors are found, be sure to contact the credit reporting agency and rectify the situation.
If you have filed for bankruptcy and also have a foreclosure on your credit, obtaining another mortgage can be very difficult. The foreclosure will stay on a credit report for seven years. Despite this, if the debtor continues to improve the credit score, this foreclosure won't have as much impact if the filer wishes to apply for a new mortgage. A bankruptcy filer with a foreclosure may qualify for a new mortgage in about three to four years, provided that it has been at least two years since filing for bankruptcy.
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