While bankruptcy may affect your credit, its impact may not be as limiting as some think. Most people who qualify to file bankruptcy have delinquencies, high credit balances, liens, judgments, foreclosures and or other issues that are affecting their credit even without a bankruptcy. In most cases, these individuals are not able to obtain credit so bankruptcy doesn’t make that any worse. It can take 30 – 40 years to pay off some credit card balances and judgments if a debtor is only able to make the minimum monthly payment. A bankruptcy cannot stay on one’s credit more than 10 years and doesn’t always have to. Many of our bankruptcy clients are able to improve their credit scores in the first year after discharge and often into the 700s. We have clients who, by managing their credit properly after bankruptcy, are able to purchase homes or refinance in as little as 2 years after discharge at competitive rates. Many of our clients have an easier time obtaining reasonable credit after filing bankruptcy than they did before.
The Fair Credit Reporting Act prohibits a bankruptcy from staying on your credit report for more than 10 years and 7 years for most other derogatory items. However, it is not mandatory that any derogatory remark stay on your credit report. A consumer can request an investigation into remarks that they feel are inaccurate. The Credit Reporting Agencies must verify all information, including addresses, names, dates, etc. The credit bureaus must delete inaccurate, unverifiable, or outdated information usually within 30 days of notice of the dispute. The Bankruptcy Attorneys at Bellenot & Boufford LLC have more than 26 years of experience helping individuals and families achieve a better financial future and quality of life.
In 2013 CBS News’ “60 Minutes” investigated the credit reporting industry and reports that “…a government study indicated that as many as 40 million Americans have a mistake on their credit report. Twenty million have significant mistakes.”
In 2012 The Federal Trade Commission (FTC) conducted a Congressionally mandated study of credit report accuracy and 6 follow up studies. In 2015 the FTC reported on its sixth study, “The Federal Trade Commission has issued a follow-up study of credit report accuracy that found most consumers who previously reported an unresolved error on one of their three major credit reports believe that at least one piece of disputed information on their report is still inaccurate.”
It is critical to maintain the highest credit score possible. Your Credit Score not only impacts your ability to obtain credit, but many other aspects of your life and the premiums you pay for many common services…
Mortgage Payments • Home Rental • Car Loans • Insurance Premiums • Employment & Salary • Cell Phone • Credit Cards • Utility Service • Government Assistance and Licensing • Security Clearance, and more
It is possible to improve your credit score and relatively quick, but you must first resolve your outstanding debt. The Attorneys at Bellenot & Boufford LLC can help you resolve your debt and better understand your credit report so you can improve your credit score, lower your expenses and provide a better quality of life for your family.
Contact us to schedule a free phone consultation.
Serving Danbury, Connecticut and all of Fairfield and New Haven Counties.