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How Will Bankruptcy Affect My Credit Score?

Maintaining good credit is an essential part of your financial health. While you realize that you need help with debt, you may fear that bankruptcy could destroy your credit score. Fortunately, while filing for bankruptcy will cause an initial dip in your score, there are many ways to start rebuilding your credit almost immediately.

At Christopher J. Kane, PC, I have been helping Oregon residents resolve their debt concerns since 2003. I have over 23 years of experience with Chapter 7 and Chapter 13 bankruptcy and the nuances of Oregon-specific bankruptcy laws. My goal is to effectively guide you through the legal process and to get you back on your feet as quickly as possible.

You Can Rebuild Your Credit Right Away

In most cases, you can start rebuilding your credit immediately after filing for bankruptcy. While this does not happen overnight, the dip in your credit score is not permanent and can be strategically improved.

When you file for bankruptcy, you stop falling deeper and deeper into debt and begin making payments that gradually improve your credit. If you discharge your debt in Chapter 7 bankruptcy, you will no longer have missed payments eating away at your credit score each month. If you reorganize your debt in Chapter 13 bankruptcy, you will have manageable monthly payments that you can actually afford to keep on top of.

What Should You Expect?

No matter the circumstances, your credit will take an initial hit. This is just for a limited amount of time before you will see it start to steadily rise. You can help rebuild your credit faster by taking the following steps:

  • Sign up for a secured credit card that allows you to deposit cash and charge against it. This shows creditors that you can make regular payments.
  • Do not spend your maximum credit each month. Instead, aim to use, and payoff, about 10-15 percent of your allotted credit.
  • Always pay student loans, rent or mortgage payments and other bills on time.
  • Use bankruptcy-friendly mortgage brokers or car dealerships if you need to make a substantial purchase.

The above suggestions are just a few ways that you can start improving your credit score. We can discuss other strategies in more detail during your initial consultation.

Contact Me To Answer Your Bankruptcy Questions

In the long run, filing for bankruptcy can improve your credit since you are no longer burdened by unmanageable debt. Learn more by calling my Portland office at 971-808-4518 or by scheduling a consultation online.

My firm is a debt relief agency. I help people find bankruptcy relief through the Bankruptcy Code.