Bankruptcy Help Blog » Filing Bankruptcy

Know how long the negative information remains on your credit report

Bankruptcy Help — Thu, 30 Apr 2009 16:15:57 +0000

By law, credit reporting agencies must remove negative information from your credit report after seven years from when the negative information is recorded, but the bankruptcy information will remain on your credit report for 10 years. The fair credit reporting act enforces correctness and fairness of information filed by the credit reporting agencies. The credit reporting agency are initiated by law to collect credit information and sell the information about you, which includes whether you pay bills on time, ever filed bankruptcy to other creditors and business. This is the place where you can find information related to your credit history and your credit scores.
This credit report contains information of every creditor, from whom you borrowed money or who had lent you money. It outlines your credit card accounts, automobile loans, student loans and mortgage or any other transaction involves borrowing. It shows the information about when the credit line was opened and how much amount you borrowed and how much amount you still owe and also record any information related to late payments or missed payments or defaults to any lenders.
The credit report also shows information that includes lawsuits such as your involvement in liens, foreclosures, bankruptcies, and repossessions. Credit card report also shows the information about the inquiries made by the other creditors. To many credit inquiries will have negative impact because the lender may not grant you credit if he sees to many inquiries from different lender as this show that you are getting overextended.
However, there are two types of inquires that does not include in your credit report are personal inquiries, those are made on behalf of you and by the companies who send you the offer by themselves through mail or phone.
But when this negative information is recorded on your credit report? Late payments are first type of negative information that is recorded on you credit report. The late payments are not reported to credit bureau on your due date but creditor will wait until 30 days after due date before they report the credit bureau. For ex: if your due date for the payment is on December 10 then if you do not pay by Jan 9 then the late payments are reported by the creditor to credit bureau after Jan 10th and they will furnish the negative information to credit bureau about the late payments.
Once reported to credit reporting agencies, the good or positive information will remain on your credit report as long as they maintained satisfactorily but the negative information on public records can remain up to seven years after the problem which caused the information to appear on you credit report. An unpaid judgment lead as you not paying bills are resulted in creditor taking you to court can remain on you credit report for 7 years after you pay the amount and will remain for ever if it is not paid and the creditor inquiries generally remain on your credit report up to 2 years
It is always a better idea to know what is your credit score and credit report and what type of actions are taken on your credit report.

No related posts.

What Does it Really Means to File for Bankruptcy?

Bankruptcy Help — Sat, 28 Mar 2009 07:22:17 +0000

Most consumers are aware that filing for bankruptcy can affect the credit rating for up to ten years – but the majority of debtors are truly unaware of the repercussions that can come from filing for bankruptcy and the real effects that can be seen on the credit report and reflected in the credit score.

In essence, filing for bankruptcy is an act that declares to creditors that you are unable to repay the debts that have been accumulated. Bankruptcy is an option for those that are unable to pay even the interest on the debt that has been accumulated and can see no way in the near future for the debts to be repaid using the income that the individual has access to.

Bankruptcy is a process that requires a lawyer who must actually file the papers claiming the bankruptcy. To choose a bankruptcy lawyer, it is important to determine the experience that the lawyer has as well as the outcome of the majority of cases. In some situations, the fees that the bankruptcy lawyer charges may determine if it is a suitable match.

Although the person may have filed for bankruptcy, it is important to realize that there are certain debts that will require repayment. Many times, when the consumer files for bankruptcy – the individual is often required to pay a portion of the debts to creditors to ensure that the creditor does not take a complete loss on the credit that has been issued.

Which debts are not covered by the individual declaring bankruptcy? There are certain debts which must be repaid in full, despite the declaration of bankruptcy. These debts are immune to bankruptcy and include; any debts that are associated with government students loans and many debts that have to do with taxes. Determine which types of debt that you hold before declaring bankruptcy to determine that in indeed the best financial decision for your particular situation.

Consumers that have filed for bankruptcy in the past appear as the highest risk borrowers. For this reason, it can be hard to obtain credit once your credit report reflects that you have filed for bankruptcy in the past. For the ten years that this notation remains on the credit report, it can be impossible to gain credit. When this notation is removed from the credit report, it will no doubt take time for the score to regain its appeal to lenders.

To increase the appearance of the credit score, the person that has declared bankruptcy must often start anew. Secured credit may be required to develop the credit report, as the credit report will often contain minimal information and a low score. Using secured credit can help to rebuild the credit score to a number that potential lenders will see as low risk and borrowing can commence again.

Image by Daylight.

No related posts.

How Will Bankruptcy Affect My Credit Rating?

Bankruptcy Help — Sat, 14 Mar 2009 04:22:08 +0000

Bankruptcy has been hailed the last stop on the road to financial ruin, but does it really have such a devastating effect on the credit rating? Although the truth is, the credit score can be effected for up to ten years, there are methods that consumers can take to build the credit rating and use credit despite the notations of bankruptcy through the credit report.

Although bankruptcy will be seen on the credit report by potential lenders, there will also be discharges – which are known to be worse for the credit score than collections accounts. It can be impossible to remove these accounts as they have more than likely remained unpaid and have a negative effect on the credit score. These accounts remain on the credit report for seven years, upon at which time they are removed from the account.

For up to ten years the consumer will be faced with the stigma of bankruptcy and be subject to rejections from lenders in the form of mortgages, loans and credit card offers. Consumers that have declared bankruptcy in the past are of the highest risk and therefore even if they are approved for a certain offer, they will be subject to the highest of interest rates.

Assets that have been gained throughout the lifetime are liable to be repossessed to cover costs associated with the bankruptcy. No longer will the consumer be able to maintain these assets and they will be removed from the credit file.

If you have recently filed personal bankruptcy, one of the smartest things to do is to make use of a secured credit card. This can be complete by providing a deposit to a credit card company that is equal to or less than the credit limit that has been offered, and begin to use the credit card. This will allow you to begin establishing credit history from the moment that you have declared bankruptcy. Rebuilding your credit rating cannot wait. At the time when the bankruptcy judgments are removed from the account, many consumers are left with no data. Using a secured credit card will ensure that credit history is developed. Be sure to use the card wisely and develop a positive relationship with the client. Over time, this could lead to eligibility for a non-secured credit card, even despite the bankruptcy.

It is important to determine the effects of the bankruptcy on the credit rating, the assets that have been accumulated and how the bankruptcy will affect your personal financial situation in the future. Do you have plans to purchase a home in the future?

Image by Raymond Brown.

No related posts.

Should I File For Bankruptcy?

Bankruptcy Help — Sat, 21 Feb 2009 02:44:56 +0000

Bankruptcy has negative effects on the credit rating and can affect the chances of being approved for credit for up to ten years. There are many situations that could contribute to an individual being at risk of filing personal bankruptcy such as an Illness within the family or the loss of a job. Regardless of the reasons for declaring bankruptcy, it is important to realize when you are at risk to increase the alternative options that can be presented.

If you are unsure about filing for bankruptcy, it is important to know that this is the largest choice that will be made through the personal bankruptcy process. It is true that the bankruptcy process can affect the credit rating for up to ten years, but there are methods that can be used to rebuild the credit rating throughout and even after this time period. After ten years, the record will be removed from the credit file.

There are certain debts which are not covered by declaring personal bankruptcy. Educational loans and personal taxes are two of the areas that are not covered by declaring bankruptcy. If the chief debt lies within these areas than bankruptcy may not be the best option to solve these problems. Be sure to speak with a bankruptcy consultant or attorney to determine if the debts lie in the area that is covered by declaring bankruptcy.

When the consumer makes the decision to file for bankruptcy, it is important to realize that any assets that you have accumulated may be at risk due to the bankruptcy process. Are you willing to put your assets at risk through the process of filing for personal bankruptcy? Assets such as homes and vehicles may be sold in the process to finance and fund the outstanding balances that may arise on each of the assets.

Are you facing overwhelming debt that seems to grow on a monthly basis? If you are unable to repay the debt with the income that you have available than often bankruptcy is suggested as an option. Sometimes, situations occur such as a job loss or change in financial situation that cause people to lose the ability to repay the debt that has been accumulated. If you are in this case, than perhaps declaring personal bankruptcy may be the best option.

Bankruptcy is often seen as a last resort, as it should be, the negative effect on the credit rating can last up to a decade and assets that have been worked hard to attain are often lost. It is important to determine the alternatives to declaring bankruptcy. These alternatives include credit counseling or debt management services, or even a debt consolidation loan. These services allow for one monthly payment to one creditor to cover the amounts that are outstanding to various creditors. As an added bonus, these methods are also often able to preserve the credit rating of the individual that is considering filing for bankruptcy.

Image by krossbow.

No related posts.