Bankruptcy Status and Your Credit Report

by Craig Peters, Contributing Writer   

Filing bankruptcy is the reddest of red flags that can appear on your credit report. Once there, bankruptcy information will stay on your credit report for up to 10 years.

Here's a brief Q&A to give you some of the basics about bankruptcy information and your credit report:

How does my credit report display my bankruptcy status?

Your status will typically appear as "filed," which means you've entered into bankruptcy proceedings, or "discharged," which means you're no longer liable for the debts you've incurred. If your case has reached the discharged stage, check your credit report to make sure your status is correct, since that's the first big step to financial recovery.

DO I need to check my bankruptcy status with all three credit reporting bureaus?

Absolutely. Just because one bureau is showing correct information doesn't mean the other two have correct data in hand. When checking the accuracy of your credit report information, always contact all three credit reporting bureaus.

What other bankruptcy information will my credit report show?

In addition to bankruptcy status, your credit report will display information such as the type of bankruptcy (Chapter 7, Chapter 11 or Chapter 13), the date of filing, the court where you filed, and your total debt liability.

What if my bankruptcy is dismissed before my debts are discharged?

You will still owe your creditors the same money you owed before bankruptcy proceedings were filed. As far as your credit report is concerned, be sure to check your bankruptcy status with all three reporting bureaus to make sure it's correct.

How will having bankruptcy on my credit report affect my ability to get new credit?

There's no way around this one: It won't be as easy as it was before. A personal bankruptcy tells new creditors that you're a high credit risk. If you do obtain credit, you're likely to pay a higher interest rate.

Once your debt is discharged, take disciplined steps to rebuild your credit. It will take some time and effort, but you'll be far happier and financially healthier in the long run.