Re: Credit rating after Ch 7 BK

Posted by LadynRed (199.91.33.254) on July 14, 2004 at 14:44:38:

In Reply to: Credit rating after Ch 7 BK posted by Glenn on July 14, 2004 at 12:41:58:

I'm here :)

Yes, its true that your scores will likely make a jump UP after you file for BK. That is because with one big swoop, you are relieved of ALL liability for all those prior debts. They no longer figure into the FICO score as individual debts.

BK will let you rebuild your credit a whole lot faster than sweating it out for the next 5-1/2 years of waiting for all the baddies to drop off your reports. During that time you will still have to put up with collectors and the threats of lawsuits. BK will stop all of that.

If, after discharge, you work at credit repair to fix the errors left from the BK and slowly and carefully rebuilding your credit, you could qualify for an FHA home loan in 2 years. You have to make sure everything after BK stays squeaky clean. Its a nasty hit to have a BK and then start showing more lates on new credit.

Its true that the BK itself can stay on your reports for 10 years, but the further out you are from it in time, the less impact it will have, especially if you're building good credit. BK is NOT a 10-year credit death sentence, but you do have to work at it diligently in the beginning.

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