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How will bankruptcy affect my credit?

 

Without a doubt, bankruptcy is the worst thing that you can have on your credit record. A bankruptcy filing can stay on your credit report for as long as 10 years. Especially in the beginning, it will be harder to get credit, and when you do get credit you may have to make a larger down payment and pay a higher rate of interest.

Even with all of that, there is a bright side. The bankruptcy will remove many (but not all) of the negative notations on your credit report. It can also prevent things like judgments and foreclosures that would also hurt your credit for years to come. Also, you are always allowed to add comments to your own credit report. For instance, you could insert a note explaining the circumstances that lead you to bankruptcy, or if you filed a Chapter 13 and paid it off early, you could insert a note showing that you paid everything in full ahead of schedule.