Bankruptcy Report Affects Credit Ratings

2007-05-02 10:04:19

( Financial )



Whether you voluntarily or involuntarily file for bankruptcy, it becomes a matter of public record which will be readily available to any credit reporting agency that will ask for a bankruptcy report. Although you may be relieved of certain liability, a bankruptcy report will become part of credit reports for a period of seven to ten years depending on the type of bankruptcy proceedings that you file, or the creditors file against you.

When you apply for a line of credit or any type of loan, lenders will secure credit reports from any of the credit reporting agencies. Credit reports contain information such as fico score report, bankruptcy report and your overall debt ratings. The credit reporting agency in turn will run for your bankruptcy report to ascertain if you have been declared bankrupt. Your name, address, date of filing, judge name, court, case number, record type, and file type are the information contained in your bankruptcy report.

If your bankruptcy reflects on your credit reports, it will become hard for you to purchase a house or a car. And even if lenders approve your loan, they charge you higher interest rates compared to those with clean records. While you can no longer do anything about your credit history, you can still do something about your credit future.

It would be wise to get copies of your credit reports each year from the credit reporting agencies and review them thoroughly. If you find any discrepancies, submit an explanation to the credit agencies stating the reasons for your financial difficulties and the steps that you have taken to avoid similar problems in the future. You can rebuild your good credit standing by getting a new source of credit such as a secured credit card. Make sure that you pay your credit card bills in timely manner to become creditworthy again.


All rights Reserved © Tradenet Services srl
Do not duplicate or redistribute in any form.