Your Credit Report After Bankruptcy

Your credit report, do you KNOW what is on your credit report after bankruptcy? Your bankruptcy can be reported on your credit report for 10 years from the filing of the case. Even if you have just filed bankruptcy it is EXTREMELY important that you KNOW how it is reported on your credit report. If you file a bankruptcy and voluntarily dismiss it before the discharge, the credit reporting agency must report the dismissal as well as the bankruptcy filing. It is NOT the credit reporting agencies responsibility to make sure that your credit report is accurate. It is YOURS, and only you can make sure that it is.

After receiving your bankruptcy discharge papers the first thing you will want to do is get a copy of your credit report and make sure that the information reported on it is correct. Did you know that over 90% of the time it is incorrect?

You will want to make sure that your report is showing the date the bankruptcy was filed and when it was discharged. Make sure that ALL creditors that you included in the bankruptcy are showing that they were and that your balance is $0 and nothing else. Profit & Loss or Charge Offs will lower your credit score. Commentary to the Fair Credit Reporting Act makes clear that a debt discharged in bankruptcy must be listed as having a 0 balance. FTC OSC section 607, item 6 states: "A consumer report may include an account that was discharged in bankruptcy (as well as the bankruptcy itself), as long as it reports a zero balance due to reflect the fact that the consumer is no longer liable for the discharged debt." Make sure they report as "included in bankruptcy" with a $0.00 balance. After the discharge, you are entitled, under federal law, to have the balance of each discharged debt reported as "O". The history of delinquencies can be reported, but the balance must be zero. If it is not so reported, dispute the debt. Assuming you have income, you should be more credit worthy after a bankruptcy than you were before, since your old debts no longer have a claim on your future income.

If a creditor shows any balance other than $0.00 and it was included in the bankruptcy it will lower your credit score. It will by your responsibility to contact the creditor and have them update your credit report to show the correct information. Be prepared, you may need to contact them several times before they get it right. But don't stop until it is.

Did you also know your credit score will go up after a bankruptcy? Why? Because all past due, profit & loss and charge offs will now show a balance of $0 instead of a balance past due.

Did you know that if your credit score is over 500 you can purchase a home and get 100% financing? That's right!! However, you need to realize that you will be paying a premium price in the closing costs and interest rate. If you do some credit repair and wait until the bankruptcy is two years old you can qualify for a Fannie Mae low interest rate loan.

Remember, you are responsible for your own credit report. No one else is going to care about it as much as you. Start working on it now, it's never to late.

Negative history on your credit report is just that: history. It does not doom you to perpetual credit rejection. It does challenge you to strengthen your present financial situation by saving and using credit carefully.