“`html

Understanding Bankruptcy and Your Credit Report

At O1ne Mortgage, we understand that financial setbacks can happen to anyone. Bankruptcy is one such challenge that can significantly impact your credit report. In this article, we will explore how bankruptcy affects your credit report, how long it stays on your report, and what you can do to monitor and improve your credit over time. For any mortgage service needs, feel free to call us at 213-732-3074.

Can You Remove Bankruptcy From Your Credit Report?

It’s important to know that you cannot remove a bankruptcy from your credit report if the information is accurate. However, if you find any inaccuracies, you have the right to dispute them with the credit reporting agencies. One exception is if a creditor has improperly filed an involuntary bankruptcy petition against you. In such cases, the bankruptcy court may prohibit reporting to the credit bureaus, and you may have the right to dispute an inaccurate filing date.

How Long Does Bankruptcy Stay on Your Credit Report?

Bankruptcy can remain on your credit reports for up to 10 years. The duration depends on the type of bankruptcy filed:

Chapter 7 Bankruptcy

Also known as liquidation bankruptcy, a Chapter 7 record will stay on your credit reports for 10 years from the filing date. This is because this option typically discharges more of your debt.

Chapter 13 Bankruptcy

Known as reorganization bankruptcy, a Chapter 13 record will be removed from your credit reports seven years from the filing date. This type involves restructuring your debts to make affordable payments over three to five years, usually resulting in a lower discharged amount compared to Chapter 7.

While it takes several years for a bankruptcy to fall off your credit reports, its negative effects can diminish over time, especially if you take steps to rebuild your credit history.

How Long Do Accounts Included in Bankruptcy Stay on Your Credit Report?

If you’ve filed for bankruptcy, you likely already have derogatory marks on your credit reports, such as late payments, defaults, charge-offs, or collection accounts. Accurate negative items are removed from your credit reports seven years from the date of the original delinquency—the date of your first late payment, after which the account remained delinquent. The only exception to this rule is if the negative information was reported inaccurately.

How to Check Your Credit Report

Whether you’re still in the bankruptcy process or your case has been discharged, it’s a good idea to regularly review your credit reports. With Experian, you can check your credit report for free anytime. You’ll also get free access to your FICO® Score, allowing you to track your progress as you work to recover from bankruptcy.

To access your credit reports from Equifax and TransUnion, visit AnnualCreditReport.com. You can get free access to each report on a weekly basis.

As you review your credit reports, look for inaccurate information, such as an incorrect bankruptcy filing date and other negative items you don’t recognize. If you find something, you have the right to file a dispute with the credit bureaus.

The Bottom Line

Filing for bankruptcy may be a necessary step in restarting your financial life, but the process can have a dramatic impact on your credit score. While it can take time for a legitimate bankruptcy record to be removed from your credit reports, you don’t have to wait until that point to start the rebuilding process.

As you work to improve your credit, monitor your credit regularly to learn more about how your actions impact your score and to track your progress. Regularly monitoring your credit can also help you spot potential issues as they arise, as well as inaccurate information that can further damage your score.

For any mortgage service needs, O1ne Mortgage is here to help. Call us at 213-732-3074 to speak with one of our experienced loan officers today.

“`