It is not uncommon to find people struggling with finances. You will find several People struggling with debt every year in the U.S. Bankruptcy has emerged as a popular way to get rid of a huge amount of debts. Consumers can file for bankruptcy under Chapter 7 or Chapter 13 and these are reflected in the consumer’s credit report. According to Dallas based bankruptcy law firm Recovery Law Group in Chapter 13, you end up repaying a portion of your debt as per a court-approved repayment plan over a course of 3-5 years. Due to this, the bankruptcy information remains on your credit report for seven years from the date of filing. In the case of Chapter 7 or liquidation bankruptcy, your entire debts are forgiven. Since no debt is paid to the creditors, this type of bankruptcy remains on the credit report for 10 years from the date of filing.
Though bankruptcy can affect your credit report negatively and can have detrimental effects on your credit history as well as your credit score, it can also provide you with a reality check and a fresh start. People who have already been having bad credit get a chance to make amends and start afresh. If you wish to know more about bankruptcy and your other options, contact bankruptcy lawyers at 888-297-6023.