My bankruptcy was just discharged. Is there any point to starting credit repair now?

Start Credit Repair Now

Yes, there is a point to starting your credit repair now. Once an account has been discharged in bankruptcy the creditor is supposed to modify the way it reports. Past due balances are supposed to be removed and any charge off or collection status is supposed to be replaced with a single reference to the accounts inclusion in bankruptcy. These modifications often are not done. But the damage requiring credit repair will likely be considerably more extensive. It is almost inevitable that the bankruptcy process will engender reporting errors both prior to and following your discharge. All of these issues should be identified and corrected with credit repair as soon after the bankruptcy is discharged as possible.

Bankruptcy and the Fair Credit Reporting Act

The Fair Credit Reporting Act has only one single reference to bankruptcy, which is as follows:

Section 605. Requirements relating to information contained in consumer reports [15 U.S.C. ยง1681c]

(a) Information excluded from consumer reports. Except as authorized under subsection (b) of this section, no consumer reporting agency may make any consumer report containing any of the following items of information:

(1) Cases under title 11 [United States Code] or under the Bankruptcy Act that, from the date of entry of the order for relief or the date of adjudication, as the case maybe, antedate the report by more than 10 years.

Working Around Your Bankruptcy

Chapter 7 bankruptcies can continue to report in the Public Records section of your credit report for up to ten years. Chapter 13 bankruptcies are removed from your report by the credit bureaus after seven years. But you should not be discouraged by the presence of the bankruptcy. Virtually all lenders will extend credit after a certain number of years have elapsed after the discharge. Many auto and mortgage lenders, for example, will lend once two years have elapsed. Hence the importance of credit repair. Credit repair will insure that everything surrounding the bankruptcy is clean and error free. Remember that everything on your credit report contributes to your scores, nothing should be overlooked.