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Can you explain bankruptcy?

There are two types of bankruptcy that typically appear on a credit report – Chapter 13 and Chapter 7.

Under Chapter 13 bankruptcy, you repay a portion of the debt under the terms of the bankruptcy agreement. As a result, the bankruptcy only remains on your credit report for seven years from the filing date.

Under Chapter 7 bankruptcy, you are forgiven the entire debt. Because you don’t repay any of the debt, a chapter 7 bankruptcy remains on your credit report for 10 years from the filing date.

From a credit reporting standpoint bankruptcy is the most negative thing that can appear in your credit history and will have a very serious and long term impact on your credit scores and creditworthiness.

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Scoped on: 08/02/2016