You may have been toying with the idea of filing for bankruptcy for some time. You may think that you can no longer go on living with the burden of debt you currently face, but for some reason, you still have not been able to move forward with filing a bankruptcy petition. You, like many other New Jersey residents, may hesitate due to the effects the process can have on your credit.
Certainly, filing for bankruptcy can have impacts that last a considerable amount of time, but it is also important to remember that the effects will not last permanently and that you can take steps to rebuild your credit soon after you successfully complete your case.
How long will it last?
The length of time that a bankruptcy filing will remain on your credit report depends on the type of bankruptcy you utilize. In general, both Chapter 7 and Chapter 13 bankruptcies can remain on a credit report for 10 years, but under some circumstances, a Chapter 13 filing may only remain on record for seven years. The fact that you filed for bankruptcy becomes a part of the public record, which is why it can go on your credit report.
Check your reports
After you complete your bankruptcy filing, your credit report should reflect how your case affected your outstanding debts. In some cases, it may say something along the lines of "discharged" or "included in bankruptcy." Of course, these reports are not perfect, and if it appears that a discharged or repaid debt still appears on your credit report, you may need to contact the appropriate credit bureau to have the information corrected.
How can you rebuild credit?
If you worry about your credit score suffering from bankruptcy, you may want to explore the many options available for rebuilding credit afterward. For example, you could obtain a secured credit card and make sure that you pay your bills on time each month. These actions may seem small, but in the long run, they could go a long way in helping you strengthen your credit score.
If you are struggling with overwhelming debt, it is likely that your credit is already less than desirable by lender standards. Filing for bankruptcy may give you the fresh start you need to get back on the right financial track. Working with a bankruptcy attorney could help you understand the pros and cons of this option and how it could affect your specific financial status.