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Can Bankruptcy Affect My Credit Score?

Bankruptcy can help you get a much better handle on your finances, get out from under crushing debt, and obtain a new financial lease on life, but it can also negatively affect your credit score. The benefits that bankruptcy can afford in a difficult financial situation, however, can far outweigh this downside. If you are considering bankruptcy, an experienced Port St. Lucie bankruptcy attorney can help you protect your finances throughout the process while also helping you better understand how to mitigate the hit your credit score takes.

Chapter 7 vs. Chapter 13 Bankruptcy

Both chapter 7 and chapter 13 bankruptcy will negatively impact your credit score. Consider the following:

While bankruptcy remains on your credit for many years, it will likely only effect your score for 18 months.

Lenders can see a bankruptcy on your credit reports, and they’ll make decisions regarding your financial requests accordingly. For example, if you are able to obtain a loan or a line of credit, the fact of your bankruptcy may significantly increase the interest rate.

Building Back Your Credit Score

Sometimes, bankruptcy is a necessary financial reset. While there are negative ramifications, they don’t negate the fact that the bankruptcy process can help you find more solid financial ground that will support your financial stability moving forward. Fortunately, there are things you can do to help you strengthen your credit score along the way, including:

Another important factor when it comes to rebuilding your credit is understanding the factors that directly affect your score, including:

Discuss Your Financial Concerns with an Experienced Port St. Lucie Bankruptcy Attorney Today

Brian McMahon at Brian K. McMahon, P.A., is an accomplished Port St. Lucie bankruptcy attorney with more than 30 years of focused experience helping valued clients like you obtain the legal help they need to reach their financial goals. If you’re ready to learn more, please don’t delay reaching out and contacting us online or calling us at 561-658-1789 today.