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How Does Bankruptcy Affect a Credit Score?

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Summary: Bankruptcy has a negative affect on credit scores, which can be reestablished by obtaining an accurate copy of the credit score after the case has been dealt with. Learn to rebuild a stable credit score within 24 months after filing for bankruptcy with information from a lawyer in this free video on bankruptcy.

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By Andy Forman
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Andy Forman, Attorney at Law, has been in bankruptcy representation for over two decades and has lead council in over 3,000 bankruptcy cases. Forman is a member of the Florida Bar and...read more

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Video Transcript

"Well, you've made the decision to file bankruptcy and you're wondering, "Will filing a bankruptcy lower my credit score?" Unfortunately, the FICO scoring system is proprietary in nature and while the filing of a bankruptcy will certainly lower your credit score, unfortunately, I can't tell you how much. But it will definitely lower the score. It's an adverse credit event on your credit report. There are some things you can do after your bankruptcy to help you reestablish and rebuild your credit. The first, and most important, is after your bankruptcy is over, get a copy of your credit report. It is impossible to rebuild credit on an inaccurate credit report. The fundamental of rebuilding your credit requires that your credit report be correct. And after a bankruptcy, that means that all of your trade creditors are listed with zero balance and having it...and having been included in your bankruptcy. Once your credit report is correct, you're on your way to rebuilding your credit after your bankruptcy and enhancing your credit score. Somebody who's good at this should be able to reestablish their credit into a normal reasonable range in about 24 months. My name is Andy Forman. Good luck with rebuilding your credit after bankruptcy."

eHow Article: How Does Bankruptcy Affect a Credit Score?

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