Many people facing financial difficulties are concerned about their credit score and want to know will bankruptcy affect credit score. Filing Bankruptcy often can have positive effects on your credit score. Admittedly, your credit score will often go down initially in the range of 150 to 250 points sometimes. However, a bankruptcy on your credit report can still be more positive than a late payment history, evictions and foreclosures.
Often, clients contemplating bankruptcy already have had severe hits to their credit report. They have late payments, evictions, foreclosures, judgments, collections and other negative credit history items. Filing before these items are placed on your credit report can show future lenders that you are responsible enough to know when circumstances are bad enough that help is needed. In addition, mortgage companies and landlords will often be more interested in whether you allowed a foreclosure or eviction on your record versus whether you filed a bankruptcy.
Filing bankruptcy for many people that already have a negative credit history does not have much effect to your borrowing ability. A poor credit score now or a poor credit score after filing a bankruptcy has no practical effect on your ability to obtain a loan based on your credit score. Creditors often will be more willing to extend credit to you after a bankruptcy because they are aware there are time limitations before a second or subsequent bankruptcy can be filed. In fact, clients often report vehicle loan offers and obtaining a credit card within months of filing a bankruptcy. These sorts of debts, if managed properly post-bankruptcy, will help you rebuild your credit. This is more important than the bankruptcy that will be on your record for 7 -10 years.
At Wischmeyer Law Office we pull your credit report and obtain a current credit score for our clients. We also provide a model of where your credit score could reach after filing a bankruptcy and, more often than not, we see that by rebuilding your credit after a bankruptcy that your score will actually increase about 100 points from its current score. This is not always the case, but often this is what we see.
Call Wischmeyer Law Office at 317-429-0210 and let us show you how your credit score may actually improve with the filing of a bankruptcy and assist you in your post-bankruptcy financial future.