• What Exactly Can Be Settled/Negotiated?
• Frequently Asked Questions
• Before You Negotiate With Creditors
• How Past Bankruptcies Affect Negotiation

• Other Debt Relief Options
• Debt Consolidation
• After Bankruptcy
• Credit Counseling

• Staying Debt Free
• Budgeting Tips
• Glossary of Debt Terms

• The True Costs Of Carrying Credit Card Debt

After Declaring Bankruptcy

Lots of people who are going through a difficult time with their debts see bankruptcy as a quick method to get a "fresh start". And while there might be circumstances where bankruptcy is in fact the preferable (or only) option, it's not the sort of choice you should make hastily.

How Bankruptcy Affects Your Credit Report:

You may not be imagine it right now while you are sinking in debt, there may still be circumstances in which you will require or want additional credit in the future. Whether it's leasing, purchasing a car, buying a home, renting; all of these circumstances involve your credit - and there's not much that looks worse on your credit history than a bankruptcy does.

Whenever a lender is deciding whether they should extend credit to somebody, they will traditionally assess the ability of the person to make routine payments based on the following:

• Recent debt-to-income ratio
• Financial stability
• Payment history

With a bankruptcy showing on your report, your financial stability and history are not going to look great to anyone.

Your credit report(s) can (and mostly will) record information on your bankruptcy for up to ten years following filing or discharge. While it's technically possible to acquire credit following a Chapter 7 or Chapter 13, understanding your credit report is what your credit worthiness is founded off, it could be really difficult if not unachievable in the majority of circumstances. When you do begin to establish your credit again, you will frequently find yourself paying higher than conventional interest on just about everything because of your history - including credit cards and mortgages.

How It Affects Buying a Home:

Because it's so important to so many people, it's worth considering how bankruptcy can affect your ability to get a mortgage as well...

While it is not impossible to get a mortgage after having filed for bankruptcy, it is much more difficult. Private mortgage companies will place the applicant under significant scrutiny - unless the bankruptcy is from long ago and credit history has been impeccable ever since. Even if that all checks out, it's difficult to get the same low rates as a person with the same credit score but a cleaner credit history.

FHA mortgages typically require the person borrowing has already established at the very least 2 other credit accounts from the time of the bankruptcy, that must be kept in excellent standing. The borrower also needs to wait a time period of at least 2 years after filing and discharge for Chapter 7's or at least 1 year following a Chapter 13.

VA financing options usually require a 2 year span of stable credit after filing and discharge too, although special situations might be taken into account.

Get a Free Bankruptcy Case Evaluation Today!

A local bankruptcy attorney can help you understand the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy, so that you can make an educated decision about the best next step for you. Fill out the form below or call (866) 871-9556 for a free bankruptcy case evaluation.