BROWN & SEELYE Attorneys at Law

 Many people believe that filing a Chapter 7 or Chapter 13 bankruptcy will ruin their credit for seven or ten years or longer.  Many credit histories report events including Chapter 13 reorganizations for seven years.  A Chapter 7 fresh start bankruptcy and a Chapter 13 can be reported for ten years.  Credit applications can inquire as to even earlier bankruptcies.  One of two circumstances usually applies when a person considers filing a bankruptcy.  Either they are in financial difficulty or anticipate it and are looking for a way to avoid it.  In either of these two cases a bankruptcy or debt adjustment plan may not hurt ones credit but may in fact be the first step in repairing a bad credit situation. 

 Probably the most important situation for which you might need credit is buying a house.  Federal regulations may allow you to get a mortgage two years after bankruptcy if you are otherwise eligible.  Many people buy a house less than two years after bankruptcy by assuming a mortgage or buying a house on contract. 

 Nearly anyone can obtain a bank credit card even if they have just filed bankruptcy by depositing money in one of the banks that offer a secured credit card.  You use the card just like any other credit card, but the bank uses the money deposited to ensure that you make the payments.  People forget that someone lending money is primarily knowing that you can and will pay them back.  If you get yourself out of debt by filing a bankruptcy you are better able to pay any new money that you borrow. 

 Many people who note a bankruptcy on a credit report are more interested in what you have done since completing the bankruptcy to make yourself a good credit risk.  Bankruptcy laws and procedures are complicated.  If you think you may need to reorganize your debts or file for a fresh start bankruptcy, consult a bankruptcy attorney.