Removing Bankruptcy From Your Credit Report

Removing Bankruptcy From Your Credit Report

A credit score can be greatly damaged as a result of a bankruptcy. In the aftermath of a bankruptcy, creditors will view this on a credit report and deny the applicant credit. The public record section of a credit report shows any actions such as bankruptcy in a credit history. Depending on the type of bankruptcy that was filed, this will be listed on a credit report for 7-10 years.

Disputing a Credit Report Over Bankruptcy

It’s extremely difficult to remove a bankruptcy from a credit report before the designated period is up. This is only feasible if there were technical legal breaches that occurred during the bankruptcy proceeding which would invalidate the bankruptcy. As with any form of credit dispute, a bankruptcy can be appealed under the Fair Credit Reporting Act. Through the Fair Credit Reporting Acts, consumers have the opportunity to approach the credit bureaus and dispute a bankruptcy or individual items included in the filing. It’s important that the consumer doesn’t argue over every issue in their credit report. If they do, their account will be flagged and their case deemed frivolous, which means they will have difficulty making any disputes in the immediate future.

Removing Bankruptcy Information From Credit Report After 10 Years

After the the designated 10-year period is up, credit reporting agencies are under no obligation to take damaging information off a report. It will be up to the consumer to make a formal, legal request to the credit bureaus to take action about their report. Consumers are advised to wait until 10 years after their bankruptcy filing date and look at their credit file to see if the bankruptcy is still listed. If it is, they can send letters to the three leading credit bureaus: Equifax, Experian and Transunion. Be sure that the letters are very short. The consumer should simply state that a bankruptcy was filed 10 years ago, and that they would like to have all records of the action removed from their credit report.

Then they will need to wait while their request is investigated by the consumer reporting agency. This agency reviews disputed information, and goes back to the source of the filing, which in a bankruptcy case would be the court. The agency will respond within about 30 days to let the consumer know the status of the bankruptcy on their credit report.

There are some important steps the consumer can take in the meantime, such as rebuilding their credit by paying bills on time and bringing down overall debt. A number of creditors will be more concerned with a consumer’s current credit behavior than by a 10-year-old bankruptcy, and if they have worked to improve your finances, they may be able to receive credit at reasonable rates of interest.