Ask Mike: Bankruptcy on the credit report
Hey Guys,
You don’t need me to tell you that the economy is in bad shape. People are losing their jobs and homes, leaving many little choice but to declare bankruptcy. One Yahoo! Answers community member asked how long a bankruptcy stays on someone’s credit report. Is there a hard and fast rule, or does it depend on a million different factors?
I hunted around the Web and found that, amazingly, there actually are solid numbers for how long a bankruptcy stays on a credit report. According to credit bureau Experian, the bankruptcy “remains for either 7 years from the filing date if it was a Chapter 13, or 10 years from the filing date if it was a Chapter 7, 11 or 12.”
So what makes a Chapter 13 different? The official site of the Federal Judiciary explains that Chapter 13 bankruptcy “allows a debtor to keep property and pay debts.” Chapter 7, on the other hand, is more akin to liquidation of all assets. Again, according to the Federal Judiciary, “Chapter 13 offers individuals an opportunity to save their homes from foreclosure.”
Regardless of your current financial status, it is important to monitor your own credit. A few years ago, the U.S. government started encouraging citizens to check their credit every year for free. With identity theft and fraud a growing issue, keeping tabs on your own credit can help stop problems before they start (or at least before they get out of control).
For more information on the various types of bankruptcy, check out this link from the U.S. government. But keep in mind that online help “should not substitute for the advice of competent legal counsel or a financial expert.” Bankruptcy law is an extremely complicated (and boring) topic. If you’re worried, do yourself a favor and speak to an expert.
Thanks for reading,
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you don’t have a clue what you’re going on about, again.
knows what bankruptcy is.. why don’t you get out into the real world for a change, there MIKE.
pretendo!
I filed a number of years a back, a personal banrupcy gnenera reamins on your credit report for 7 years or so unless that tme frame was changed when the new bankrupcy laws went into effect afew years back
But remember, with a Business a Bankrupcy does not mean they ae closing thier doors ( or not atthat point) all it does it protctthem from their creditors lets them “reorganize and work out different terms with creditors or tryto sell the busines off, if noneo f thoswork then they ligudate to settle back debts ie: Circot City recently, the filesfor bankrupcy back in nov of 2008 but were unable to work out terms withtheir creditor and could not fnd a buyer so they had to liguidate all their stores to make good on their debts,
I need a “tutorial” for Canada to.
People that file a BK need to know the importance of keeping their credit squeaky clean after a BK discharge. Having negative credit after the BK is worse than the BK itself. Rebuild carefully and don’t take on more debt than you need or can afford.
Mary in Camden, MI
I learned a bit in my last year economics class, and my teacher was saying that even though the it only stays on your record for 7 years, when it goes away there is a big empty space where over the last 7 years you were pretty much unable to do anything, and in away it can also make it hard to get credit even after the 7 years…
Mike
The problem in this country is not the economy
It is CREDIT and the foolish use of it .
Americans today are more in debt then ever before
because we live in this “got to have it now” mentality
What ever happend to the idea of saving for what you want? or saving for a latter day
People buy things on credit that they simply could not and can not afford.
Lucky for me a few years ago I started listening to Dave Ramsey and got my self out of this debt trap. Now in my early 40′s I live and will always live DEBT FREE . This is the only way we Americans can secure our future. don’t become
trapped by the credit monster
thank freind has give information about our in live..
suggestion me :
you are spirit and enjoy in living the world….
don’t forget prayer and is patient..
special in this life…
by.. freinds newly.
ttd. muliadi,
How can i open my sender
Actually it doesn’t wipe clean off your record until the eleventh year and one day.
My business teacher is a lawyer and he explained it is miss-understoood by most all people even in the business.
You’re messed up for eleven years and one day.
Plus a holiday if the last day is one.
Well, it like black death on the credit report and it sometimes last more than ten years. Yes , employer check your credit more carefully.
Thanks Mike, looks like I’m going to declare bankruptcy soon myself lol, hopefully things will get better, for everyone.
according to myself, unless the laws have changed following the subjected recession, all chapter 7′s must now be automatically rolled over into chapter 13′s, which is consolidation!♥
i’m not totally informed as of late, however my own was right after that law was passed, my 7 discharged all unsecured, my chapter 13 i was able to incorporate everything for a period of 5yrs, which was thus paid off in 15 months!♥
also note, that such debts as back child support from a previous partners deliquency is also adaptable, being included into a chapter 13, as was my ex’s!♥
just some added info!♥
I understand that your “bankruptcy”stays on your credit report in the public records section, but…aren’t the accounts included in the bankruptcy supposed to be cleared from your account history? I mean aren’t those items supposed to be gone?
The Fair Credit Reporting Act requires credit bureaus to drop bankruptcies – all varieties – after 10 years. They certainly may drop them earlier, but are not required. And people should understand that, while the relevant date most use is the date of filing of the bankruptcy, there are some that say it is the date of discharge or even closing of a case.
People who do not know what they are talking about should refer askers to competent responders, not provide half-a**ed answers..
7 Years period
and student loans cannot be claimed on a bankruptcy, they will always stay with you
If you want to go to college while you are still young…you must go on credit. If you want to “own” a home before you retire…you must get it on credit. Meanwhile the IRS steals 20%-30% of your paycheck to take out more loans from the international banking cartel that increases our 11 trillion dollar national debt. Americans are irresponsible, not in their spending, but in settling for an economic system that is PARASITIC and PREDATORY. Yes, “change” is in the air alright, but a bigger change than the power elite and their talking heads on television may have ever planned on, LOL!
my sister in law filled for bankruptcy twice and she gets her credit back in less than 3 years the first time and in less than 4 the second time,did she learn any lesson in about how to take care of her credit:NOPE,now she has all this credit cards back in her wallet like nothing ever happened.what’s the point of filing for bankruptcy,people is just abusing the system!!
my aunt declared bankruptcy and bought a house just 2 years later. had no problems and now just bought a 2nd house.
I had to file two years ago due to the loss of my wife. It is hard but does not end your life. I have financed a car in the last year, have two low rate APR credit cards, and am about to close on a house. DO NOT DO IT UNLESS THERE IS NO ALTERNATIVE, but if you do have to it is not the end of the world. You can get credit as long as you have a good job and pay bills on time after the discharge, it does not leave an eleven year “hole” in your credit file.
I think the people are out of their minds. When the second war is over, the amount of people without jobs was enormous, without houses, without business buildings and rapidly the economy and the countries grows to become in stable situation. Now some news and television, spreads a “disaster” when business and homes are entire in their buildings, the people seats in their desks and looking for the computers the rates going down… what a fallacy!
Lets keep this out of our sights, out of our minds and keep working and projecting good, like the worst had passes already. Someones are watching the reactions and not action in any way!
people should file for chapter 7 and not worry about how long bad credit will last. and forget about credit scores. live for todayand let tomorrow take care of tomorrow. enjoy living debth free.
My bankruptcy discharged December 2006. As of today, my credit score is no 670. I’m proud of myself. Creditors, apartment rental people, mortgage people see my bankruptcy but then they also look at my good score and how I have a few credit cards that get payed off pretty fast.
I agree with dr.bucksnort. Want to live debt free, stop buying things on credit. Or better yet, learn to either do without or put it on layaway. And these banks and thier marketers dont help. They make these commercials where “you can have this now with low interest”. They and those who fall for their sales pitch, are the reason the economy is horrible. I dont feel bad for those people who tried to live beyond their means. You reap what you sow. There may be only a handful who are true victims of such a crisis and that are those with medical bills. If you dont have health insure, you are already in debt over your head. Those are probably the ones who I would have sympathy for.
You’re only allowed to look at certain things in your credit report for free. Take that (annoying) freecreditreport.com commercial or whatever it was: They SAY you can check it out for free but only the BASICS. If you wanted to look at more, you have to pay. Also, you can sign up online but they say, for some stupid reason, for security reasons, you have to call to cancel it. There is no way to cancel it online. The only reason you have to call is so they can sell you more services. So, it it’s not secure to cancel it, why was it secure enough to sign up?
I filed for bankruptcy 3 yrs. ago and the credit card applications poured in did I have a credit card problem…no I lost my job due to downsizing ..after holding it for over 8 yrs could not make the big car payment i took on when i was doing well so let car go back and the bank after many attempts from me to make lower payments came after me for the entire amount they wanted almost the same payment …and they had the car so my only option i was told was to file It still pisses me off because most good companies do look at your credit..dont ask me what i do for a living now …it is half my old pay
to LeAnne. The debts will say “discharged in bankruptcy” after the bankruptcy is closed. Which means they’ll still be on your credit for as long as the bankruptcy is open. In a 7 that means for six months or so. In chapter 13, that means it’ll be on there for 3-5 years.
As far as bankruptcy demolishing your credit, you can still buy cars, homes and get credit cards after your bankruptcy or even duringthe bankruptcy with the Trustee’s approval. (Credit cards even send applications to the debtor’s bankruptcy attorney to help “rebuild their credit”. How’s that for ridiculous?) BUT it’s NOT a free ride. The interest rates are much higher, and they often require more collateral and sometimes a cosigner.
Over the past year people have been turning to Debt Settlement as an alternative to BK’s. I actually own a debt settlement company, and I am the first to say if you can qualify for a Chapter 7 its the best way to go. However trying to qualify for a Ch 7 is very difficult, you have to be insolvent and have nothing left. A chapter 13 is where a state trustee puts you on a strict budget and you are on a payment plan for 5 years. What they are doing here is stopping the interest and you end up paying most if not all of the principle. With a debt settlement plan you are put on a savings plan we negotiate with the creditors and we can usually clear your debt in 36 month. Sure this will have a negative affect on your credit just like a BK, How ever when you have completed the program all the credit lines report “accounts satisfied” and there is no traces of a BK. Also after the completion of the program we can put you in a rapid re-score to start to repair your credit. If anyone has any questions I would welcome you to contact me.
I learned a bit in my last year economics class, and my teacher was saying that even though the it only stays on your record for 7 years, when it goes away there is a big empty space where over the last 7 years you were pretty much unable to do anything, and in away it can also make it hard to get credit even after the 7 years…
False
Actually it doesn’t wipe clean off your record until the eleventh year and one day.
My business teacher is a lawyer and he explained it is miss-understoood by most all people even in the business.
You’re messed up for eleven years and one day.
Plus a holiday if the last day is one.
False
There is so much misinformation here my head is spinning.
Greetings all members,
I would just like to say hello and let you know that I’m happy to be a member – been a lurker long enough
Hope to contribute some and gain some knowledge along the way….
Bankruptcy is a state in which people do not have the required amount of money to pay for their debts. Bankruptcy is of two types, one is voluntary, where people themselves declare that they are bankrupt and the second is involuntary where the person is charged with the case of bankruptcy. Conditions Under Which People