Long-Term Effects of Bankruptcy
Bankruptcy is sometimes the best option for people with too much credit card debt. The downside to filing for bankruptcy is that it stays on your credit score for a long time, often for as long as ten years. Although bankruptcy can be a rather large set back on your credit score, it’s not irreparable by any means.
If you are having trouble paying off your debts and credit card bills, then filing for bankruptcy might be the best option to consider. Bankruptcy will allow you to get back on your feet and have a fresher start. For information and legal counseling on the subject of bankruptcy, contact the Boca Raton bankruptcy lawyers of Klein Attorneys at 561-353-2800 to discuss your situation.
Bankruptcy and Your Credit
Your credit score is used to judge your credibility and creditworthiness so investors can gauge the risk of giving you a loan. While you know that bankruptcy can stay on your history for a long time, how else will it affect your credit score? The following will likely occur:
- Most creditors are hesitant toward people that have just filed for bankruptcy, but will still give you a credit card knowing that you cannot file for bankruptcy again for another seven years.
- Anything credit line you apply for will likely have high interest rates.
- Certain things will be erased from your credit score; late payments, balances, unpaid debts will not show up any longer. Instead, your account will be marked as “under chapter 7 bankruptcy” or whichever chapter under which you decide to file.
- Your FICO score, a score used to decide your credit standing, will only be compared to other people that have filed for bankruptcy.
While some of these consequences can be frustrating, it is important to remember that they are temporary. After 10 years, your bankruptcy will be removed from your credit history.
Contact Us
Due to recent changes in the law, it might be harder for you to file for bankruptcy than it would have been in previous years. For more information, contact the contact the Boca Raton bankruptcy lawyers of Klein Attorneys at 561-353-2800 to discuss your situation.
