New Bankruptcy Law Secrets
Credit Reporting Trap
You struggle through
your bankruptcy and get your debts forgiven. Your bankruptcy appears on your credit report
where it stays for a full ten years.
For the first few years you will find it difficult and expensive to either buy a car or a home. But over the long years you carefully rebuild your credit rating. You count the months until at long last your bankruptcy entry vanishes from your credit file.
(Warning: Though the law states clearly that the entry concerning your bankruptcy filing be removed from your credit file after 10 years, you will probably have to write a number of letters to the three largest credit reporting agencies to get your record cleaned up.)
You want to buy a new house but wait until the bankruptcy note is removed from your file because it will be easier to get a good credit rating - right?
WRONG! Make the purchase BEFORE your bankruptcy is removed from your credit file. Starting from the day after your bankruptcy, you'll have to work to rebuild your damaged relationship with creditors.
It's difficult but you CAN rebuild it and live a more or less normal life. But when your credit file is clean again, your credit rating will take an immediate dive. There are a number of different reasons for this but one of the major reasons has to do with your ability to file yet another bankruptcy.
Those who can't seem to get their spending under control often resort to bankruptcy over and over. The only restriction is that pesky eight year time limit. If you're within eight years of your last filing, you'll have to pay any bills you incur. But when that time limit expires - creditors fear you'll soon be on the path to yet another filing.
If you need a new credit card - get a card with the lowest interest rate you can BEFORE your bankruptcy comes off your credit rating.
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