Chapter 7 Bankruptcy Lawyer San Diego - Is My Credit Ruined Forever?
Bankruptcy myth - Your credit is ruined forever- Wrong!
Your credit could and often does actually improve after bankruptcy. That is because the negative information that is probably now being reported to the three credit bureaus will turn to positive information.
If you are currently behind on your payments on a number of credit cards then that information is reported to your credit reporting agencies monthly. This has a continuing negative effect on your score until you take some action. You can either pay these debts or file bankruptcy and get the debts discharged in bankruptcy.
If you file bankruptcy and receive a bankruptcy discharge your debts will be listed on your credit report as “discharged in bankruptcy”. The debts cannot then negatively impact your credit score anymore. Your credit will go down immediately after the filing but you can then begin to build it up. Your score will not remain low if you take action after the bankruptcy to raise it.
Before you file you could probably not afford to keep up with your payments. Now, after bankruptcy, you no longer owe the debts and you therefore no longer have to service that debt. You are relieved for the burden of having to make the payments any longer.
Without having to pay on those old cards you can now get new cards that you can use to re-build your credit. You will be offered new cards after the bankruptcy so use them to improve your credit score. Now your credit score can rise as you use these new cards wisely and pay them on time each month.