After you complete your bankruptcy discharge, you may be thinking that you are in the free and clear with regard to having a solid foundation on which to build you can build credit. However, you still need to keep an eye on your credit report after your bankruptcy proceeding is over. The following are some things you should know about your credit after completing bankruptcy:
When to Check Your Credit Report
You should start checking your credit report within the first few months after your discharge. It can take some time for the credit reporting agencies to update your credit report with all of the changes.
Time it Takes for Bankruptcy to Disappear from Your Report
Another thing you should know is that it is going to take some time for the bankruptcy to drop from your credit report. It can stay on your report for up to a decade for Chapter 7 bankruptcy after the date of the filing. Chapter 13 bankruptcies fall off a few years sooner. While this may seem like it is detrimental to you obtaining credit, keep in mind that your credit will improve as the years go by despite the bankruptcy. You will eventually be able to get loans, purchase a car, or get a mortgage.
The Discharged Debts
Another concern is how the discharged debts are listed on your credit report. All the debts will have a notation next to them stating they were discharged in bankruptcy. The balance will be zeroed out unless you chose to reaffirm the debt. If your debts are not reaffirmed but are not showing a zero balance, you will need to dispute them with the credit reporting agency.
Paying Back Debt That is Not Reaffirmed
Some people choose to keep certain properties that are secured by a loan by still making the payments, such as a home or a vehicle, and not reaffirm the debt. If you do not reaffirm the debt at the bankruptcy, it will be listed as discharged anyway.
How Reaffirmed Debts are Reported
Many bankruptcies do not have reaffirmed debts. However, when there are, they should show on the credit report. Continuing to pay these debts will help improve your credit. Making the payments late will have a negative impact. This is why many people choose not to reaffirm debts.
If you are considering bankruptcy, it is important that you know how it will impact your credit. It can have an impact on your future spending, so make your decision carefully. To learn more about bankruptcies, contact a company like Affiliated Legal Services Inc.
