Life After Bankruptcy
How long does bankruptcy stay on my credit report?
A bankruptcy legally can remain on your credit report for up to 10 years, although some credit reporting bureaus may drop it sooner. The effect of bankruptcy on your credit score can start to diminish much earlier if you adopt responsible credit habits such as paying your bills on time, using only a small portion of your available credit and not applying for too much credit at once. With time you can rebuild your credit history after bankruptcy by getting smaller amounts of credit and responsibly paying your bills on time.
Can I buy a car after I file bankruptcy?
Yes. Secured debt is often an excellent way to re-establish credit. You may pay a very high interest rate at first, but as time passes, you will be able to trade the vehicle in or sell it and buy a new car with a lower rate.
Will I ever be able to buy a house after bankruptcy?
Yes. Lenders typically look at a period over which payments have been made, so if you have established credit and are paying on it regularly, you may qualify for a mortgage. The longer you wait after a bankruptcy, the better your rates and options will be.
How do I rebuild my credit after bankruptcy?
Continue to pay installment loans. Get a secured credit card. Use it lightly and wisely. Check your credit report regularly to make sure that accounts discharged in bankruptcy are listed as such and that there are no new delinquent or fraudulent accounts. Develop good bill paying and credit habits by staying within your income and paying your bills on time. Have a mix of types of credit – installment, secured and unsecured.
Can I file bankruptcy again?
Yes. You may file a subsequent bankruptcy as follows: After a chapter 7, a subsequent chapter 7 bankruptcy may be filed eight years after discharge. A subsequent Chapter 13 may be filed four years after discharge. For individuals who filed Chapter 13 bankruptcy, a subsequent chapter 13 may be filed as early as two years following discharge, and a subsequent chapter 7 may be filed six years after discharge.
There are certain debts that generally cannot be discharged during a bankruptcy such as taxes, student loans, child support, and alimony. It is important that you make these payments on time since any late payments could continue to be reported to credit bureaus and negatively impact your credit report information.