Follow Up With The Credit Bureaus And Request A Deletion
Once you have a letter from the court stating that it hasn’t verified your bankruptcy with the credit bureaus, follow up with the credit bureaus.
Mail another letter saying you contacted the administrator of the courthouse and they told you they don’t furnish records and information to the credit bureaus.
And be sure to include a copy of the court’s response letter to back up your statements.
In your follow-up letter, you should also request a deletion of your bankruptcy based on a lack of verification.
There is no guarantee of success, but it’s definitely worth a try!
Strategies To Remove Negative Credit Report Entries
Negative details on your are unfortunate glaring reminders of your past financial mistakes. Or, in some cases, the mistake isn’t yours, but a business or credit bureau is to blame for credit report errors. Either way, its up to you to work to have unfavorable credit report entries removed from your credit report.
Removing negative information will help you achieve a better credit score. A better credit report is also the key to getting approved for credit cards and loans and to getting good interest rates on the accounts that youre approved for. To help on your way to better credit, here are some strategies to get negative credit report information removed from your credit report.
Bankruptcys Impact On Getting A New Job
Employers are allowed to use credit reports to make hiring decisions, as well as when they evaluate employees for promotion, reassignment, and retention. In fact, many employers ask for credit reports, driving records, and criminal histories.
The prospective employer has to let you know theyre going to pull your credit report and get your written authorization to do so.
The bankruptcy law says the government cant deny you a job just because you filed for bankruptcy. Private employers cant fire you because you filed for bankruptcy.
As to new employers, the rule is unclear because that part of the law is written poorly. Courts in New York have ruled that a private employer cant refuse to hire you because you filed for bankruptcy. Judges in Mississippi, Pennsylvania and Florida, however, have said the opposite.
My experience as a bankruptcy lawyer over the past 20 years shows its better to be out of debt when you apply for a new job than to have past due debts showing up on your credit report.
If you owe money, your employer may think youve got a motivation to steal. Once youre debt free, that motivation disappears and your potential employer is likely to be more comfortable hiring you. Lots of people have come to me after Human Resource Managers and headhunters have told them to get their debts wiped out to for a better chance at a good job.
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Reporting Accurate Negative Information
When negative information in your report is accurate, only time can make it go away. A credit reporting company can report most accurate negative information for seven years and bankruptcy information for 10 years. Information about an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer. The seven-year reporting period starts from the date the event took place. There is no time limit on reporting information about criminal convictions information reported in response to your application for a job that pays more than $75,000 a year and information reported because youve applied for more than $150,000 worth of credit or life insurance.
Removing A Bankruptcy Filing From Your Credit History
A bankruptcy discharge can be removed from public records if you prove it was misreported.
You should be wary of mistakes such as:
- Incorrect information on your credit report
- Individual accounts staying on your credit report longer than 7 or 10 years
- Incorrect bankruptcy filing dates
- Discharged debts still showing on your report
- Incorrect names, addresses, contact information, or dates
- Bankruptcy appearing on your report when it wasn’t your responsibility
In some cases, a bankruptcy can appear on your report because of mistaken identity, identity theft, administrative mistakes, or a completely random error. These are less common, but you may need an attorney to prove it is not your responsibility.
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Can A Debtor Get Credit Bureaus To Remove Mention Of Bankruptcy From Credit Reports
A Chapter 7 bankruptcy filing is like any other negative reported item on a credit report. It is something a consumer wants to purge as soon as possible. The goal is to order the credit report, check it for accuracy at least once a year, write bureaus with explanations of unclear or confusing items, dispute inaccuracies, insist the bureau verify the bankruptcy’s filing, and remove any unverified information.
The important thing to realize about is they must take the verification process very seriously. Especially in today’s consumer protection-oriented culture and litigious society, bureaus are required to verify disputed and contested information on credit reports, and savvy, educated consumers know this.
Further, the verification process is difficult to do remotely. Credit reporting bureaus cannot expend resources to personally visit courthouses and review records face to face. Often, courts will not release information for privacy and public policy reasons over the phone, fax, or email. As such, bureaus are at a loss to verify information, including bankruptcy filings, especially in subsequent years after the initial year of a petition’s filing.
Accounts Included In The Bankruptcy
After youve filed for bankruptcy, the accounts included in your bankruptcy will show up as included in bankruptcy on your credit report. Most of them will remain on your credit report for seven years. These include accounts like charge offs, collections, repossessions, and judgments. They can also potentially be removed from your credit report before the reporting limit of seven years.
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Errors In A Report Take Action To Correct Them
If a bankruptcy filing appears with errors, immediate action should be taken to have it removed. Errors may include clerical mistakes such as a miss-transposed Social Security number, or misrepresentations due to identity theft or mistaken identity. Any case of inaccuracy on a credit report should be reported to the agency immediately and in the case of identity theft, an additional fraud alert should be placed on the report.
Time Limits For Negative Information
By law, are only allowed to list negative items for a certain amount of time. For most negative information, the time limit is seven years or seven years plus 180 days for a charge-off. Bankruptcy, however, can stay on your credit report for up to 10 years.
An account closed in good standing may remain on your credit report much longer than seven years.
Normally, you dont have to do anything to remove old debts from your credit report after the time limit has run out. The credit bureaus will automatically delete the negative items from your credit report once they’re scheduled to be deleted. However, if old accounts are still on your credit report, you can use a dispute process to have them removed.
Note that the credit reporting time limit applies to negative items. There’s no law requiring credit bureaus to remove old accounts that do not contain negative information. Instead, the credit reporting time for these is based on credit bureau reporting guidelines.
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Is Your Credit Rating Really Worth Stressing About
Are you current on all your debt payments? Yes? No? Maybe?
If youâre behind on any debt payments, your credit score could probably be better. So, rather than worrying about possibly making your already bad credit worse, think about how a bankruptcy discharge could help you build credit.
So, what happens to my credit score if I file bankruptcy?
Like all negative information reported to the credit credit bureaus, filing any type of bankruptcy will have a negative impact on your credit score. Since a bankruptcy filing is public record, they will find out, even if theyâre not directly notified by the bankruptcy court.
But, unlike other things that have a negative effect on your FICO score, a bankruptcy filing is often the first step to building a good credit score.
How Does A Bankruptcy Affect Your Credit Score
Having a bankruptcy on your credit report can be devastating to your credit scores. According to FICO, for a person with a credit score of 680, a bankruptcy on your credit report will lower your credit score by 130-150 points.
For a person with a credit score of 780, a bankruptcy will cost you 220-240 points. That one event immediately drops you several categories lower and impacts your ability to access credit, and yes, the higher your initial credit score is, the more it falls.
You might not be eligible for future loans or credit cards, and if you are, youll most likely end up paying much higher interest rates. Not only that, the amount you can borrow will probably become limited.
While filing for bankruptcy may be the best financial decision at this point in your life, its still important to understand how and why it affects your credit score.
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How To Remove A Legitimate Bankruptcy From Your Credit Report
I hate to start with the bad news, but here you go: if you have a legitimate bankruptcy on your credit reportmeaning, you filed the bankruptcy, went through the legal process, and you know the bankruptcy is the real dealthe chances of getting it removed early are slim.
You can improve your credit score.
Get your FREE, no-obligation online credit evaluation now.
- FREE access to your credit report.
- FREE review of your negative items.
- FREE credit improvement analysis.
But is all about knowing the rules of the game and using little technicalities to your advantage.
And one thing you MUST understand is that the credit bureaus are required by law to report items on your credit report accuratelyand this includes bankruptcies.
If you can find something inaccurate about the way the bankruptcy is reported, you may have a chance at getting it deleted from your credit report.
In other words, you shift the burden of proof to the credit bureaus by requiring them to verify that the bankruptcy is totally and completely accurate.
Here’s how to do it:
How To Remove Public Records From Your Credit Report
It happens to the best of us. You blithely open your credit report, just to take a look, when you encounter something you hadnt expected to see. Fraudulent accounts or activity history is scary enough. But, public records can be even more sinister. They have far-ranging implications for your ability to get a loan, secure a lease, or even get a job.
So what can you do if you find a derogatory public record on your credit report? And most importantly, how can you get rid of it?
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How Can I Wipe Out A Bad Borrowing History
Some items will stay on your credit report for several years anyway:
- A bankruptcy will stay on your credit report, from the date of discharge, for six or seven years , depending on the credit bureau, the province you live in, and whether you were also previously bankrupt.
- A consumer proposal will stay on your credit report, from the date of discharge, for three years.
However, some lenders will consider giving you credit anyway, if you eliminate the other bad history and create some good history.
To eliminate bad borrowing history from your credit report as quickly as possible:
Tips To Help Rebuild Your Credit After Bankruptcy
If youve already felt the wrath of bankruptcy, chances are youre not feeling too optimistic about your future credit score. However, the good news is filing for bankruptcy wont haunt you forever, and the odds of rebuilding your credit are definitely in your favor.
Of course, having the bankruptcy removed from your credit report is the easiest way to get your credit back on track in the shortest period possible. You can also take the following actions to boost your score:
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File A Dispute Directly With The Reporting Business
Reporting businesses include credit card issuers and banks. Upon receiving a dispute, they are required by law to investigate and respond. If the reporting business corrects the issue, you saved yourself the step of contacting the credit reporting agency. It is vital to make sure the items are cleaned up for all three credit bureaus mentioned above.
However, trying to work out your debt directly with the lender will not necessarily change the amount of time said negative item would remain on your credit report. It will only change if the dispute is resolved with the lender and deleted from your credit report.
The Legal Process Of Removing Bankruptcy Errors
You can challenge any error you find on your credit history or bankruptcy filings. They must be removed if the credit bureau or reporting agency cannot prove they are legitimate.
To prove there is a mistake, you need to follow these steps:
Proving bankruptcy fraud can be drawn-out and time-consuming. A legal advocate can help reduce stress and save time throughout the process.
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Can I Apply For Credit
After your bankruptcy has ended, there is no restriction on applying for loans or credit. Its up to the credit provider to decide if they will lend you money.
Your credit reportwill continue to show your bankruptcy for either:
- 2 years from when your bankruptcy ends or
- 5 years from the date you became bankrupt .
It can take time to rebuild your credit rating.
For more information regarding your credit report, contact a credit reporting agency. Information about credit reporting agencies is available at ASIC’s MoneySmart.
Hire A Credit Repair Company To Help
If you’d rather save yourself the time of going through this entire process yourself, you may want to look into hiring a professional credit repair company to help you do it.
Take a look at our review of the best credit repair companies.
Keep in mind that these companies charge a fee for their services, so you’ll need to factor cost into your decision.
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How Long Does A Chapter 7 Bankruptcy Stay On Your Credit Report
A Chapter 7 bankruptcy allows you to repay your creditors in order to settle your debts. However, you have to meet a means test in order to be able to file for this type of bankruptcy.
Once you do file, it takes up to ten years for a Chapter 7 to come off your credit report, assuming you dont take any actions to have it removed sooner.
Reporting Debts As Discharged In Bankruptcy
While it might be daunting to think about a bankruptcy filing showing up on your for ten years, it might not be as bad as you think. A bankruptcy discharge can help you clean up debt much faster than you’d be able to do yourself.
For instance, instead of a delinquent or unpaid debt lingering on your report for years, it will show as being discharged as part of your bankruptcy. In fact, creditors won’t be able to report your debt in a variety of ways that could cause your credit to suffer, such as allowing the obligation to show as:
- currently owed or active
- having a balance due, or
- converted to a new type of debt .
Such reporting labels are often the reason creditors deny applicants credit. In some cases, applicants must pay off such debt as a condition of loan approval. Instead, when you pull your report, each qualifying debt should be reported as:
- having a zero balance, and
- discharged, “included in bankruptcy,” or similar language.
Unfortunately, some creditors don’t update information to the credit reporting agencies. This tactic could be a way to get you to pay up, even though you no longer legally owe the debt. If your credit report shows an improperly labeled discharged debt, you’ll want to take steps to correct the problem.
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