How Will Filing for Bankruptcy Hurt My Credit Rating?
A chapter 13 bankruptcy filing will typically be on your credit record for up to 7 years; a chapter 7 or 11 bankruptcy filing will be on your credit record for up to 10 years. The shorter time span for chapter 13 is because the consumer has tried to repay a portion of his debts. However, you should know that the Fair Credit Reporting Act (FCRA) allows a credit bureau to report any bankruptcy, including a chapter 13, for ten years.
If you have a FICO score of 680, bankruptcy will cause a decrease in your score of 130-150 points. If you have a FICO score of 780, bankruptcy will cause a decrease in your score of 220-240 points. By way of example, a foreclosure can lower your credit score up to 160 points while maxing out a credit card has the least numerical impact (as few as 10 points).
For more information on how bankruptcy will cause credit to be more expensive for you in the future, go to this finance.yahoo.com article.
For more information on how bankruptcy will effect your credit score in general and what you can do to lessen the impact, go to the FICO Website.
Wesley H. Avery, Esq. CLS-B
Law Offices of Wesley H. Avery, APC
758 E. Colorado Blvd., Suite 210 Pasadena, California 91101 (626) 395-7576 (office) (661) 430-5467 (fax)