Filing for Bankruptcy Can Actually Improve My Credit Score?!
If you are one of many New Yorkers struggling with debt, then at least one of your goals is to improve your credit score. Unfortunately, when weighing their options, many don’t even consider Bankruptcy as a path toward resolution. If you were to consult with a professional bankruptcy lawyer, however, there is a strong chance that they would advise this option.
It is true that filing for bankruptcy may initially cause your credit score to drop. In most cases, however, this initial drop is only temporary and, over time, tends to be followed by marked improvements in the credit scores of many bankruptcy filers. To learn more about how this process typically goes, contact Warner & Warner, PLLC and ask to speak with one of our knowledgeable and experienced bankruptcy attorneys. Our bankruptcy law firm proudly serves clients throughout the Albany and Saratoga Springs region.
But Everything I’ve Read Says that Bankruptcy Hurts Your Credit Score… How Can This Be True?
Good question. An expert bankruptcy lawyer can explain the process in detail… But first, it’s important that we review the most common reasons that people live with decreased credit scores: making late payments or missing payments entirely. Other reasons include a high “Debt-to-Income Ratio” and “Line of Credit Usage.” It should be noted that, even with perfect payment history, New Yorkers with high Debt-to-Income Ratios and/or Line of Credit Usage can fall victim to decreased credit scores.
So You’re Saying that Bankruptcy Can Fix These Problems?
That’s correct. Filing for bankruptcy results in the elimination of all debts (outside specific categories of debt e.g. child support). Once these debts are eliminated, the negative remarks attached to the now discharged debts will also be eliminated.
Again, any bankruptcy will likely take an initial toll on your credit score, but this is not where the story ends. Working with a trusted bankruptcy attorney will further ensure that things work out in your favor.
Filing for bankruptcy is an excellent option toward achieving the fresh financial start that you deserve!
Have additional questions about filing bankruptcy to eliminate debts?
Call our bankruptcy law office today at (518) 451-9388 or (914) 280-8592 to schedule your free consultation!