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Bankruptcy: Let’s Separate Fact From Fiction

On Behalf of | Jun 27, 2018 | Chapter 7 bankruptcy

Are you one of many Ohio residents who cringe whenever someone mentions bankruptcy? It’s definitely a term that has been attached to some very negative stigmas. In recent years, however, that has changed, as more and more people (perhaps including you) have come full circle to realize that bankruptcy is often a viable choice in light of serious financial problems.

If you’re considering bankruptcy as a financial tool to help you get things back on track, you’ll want to seek clarification of the laws that govern such matters in this state. You’ll also want to be aware of common myths associated with the process. The more you know ahead of time, the better, as well as having a plan of action in mind if you need experienced support along the way.

Prior credit report info does not directly affect post-bankruptcy score

If someone tells you that the less negative information on your credit score before filing for bankruptcy, the less impact bankruptcy will have on your overall score, it is misguided information because bankruptcy will still appear on your credit report and remain there for a certain amount of time, depending on the type of bankruptcy you file. Prior credit report information in relation to filing for bankruptcy does not change your score as much as it does the severity of bankruptcy and length of time it remains on your report.

It’s not necessarily impossible to regain good credit score post-bankruptcy

It’s true that filing for bankruptcy will appear and remain on your credit report for a length of time between seven and 10 years, depending on the type of bankruptcy you file. However, it is a myth that you can’t rebuild a good credit rating as long as a bankruptcy remains on your report. There may be ways to increase your score, and it may even be possible to achieve a score of 700 or higher. You may want to seek experienced guidance as to which options best fit your goals.

You may qualify for a post-bankruptcy credit card

One of the biggest myths associated with bankruptcy is that you can’t get credit cards if you have a bankruptcy on your credit report. There are, in fact, secured credit cards for which you may qualify that can help you rebuild your credit rating. You may even be able to secure a credit builder loan by paying a deposit and offering an acceptable form of collateral.

It’s always best to thoroughly research your bankruptcy options and dispel common myths before determining if this type of debt relief is right for you.  You can assume that many Ohio residents have successfully overcome similar financial problems. Speaking with someone who has shared a similar experience may point you in the right direction for seeking experienced guidance to help find a solid solution for your current financial problems.