People are often hesitant to file bankruptcy because they are concerned about how it will affect their credit. However, most people who are considering bankruptcy have already missed payments on many bills. They have fallen behind and been threatened with foreclosure, repossession or garnishment. Their credit has already been severely damaged. Some may be current, but their income-to-debt ratio is such that their credit score is or will soon be affected. If you remain current on your debts, but it will take you more than 20 years to pay them off, you are not in a positive financial situation.
In considering a bankruptcy, ask yourself this question: Where will I be five years from now if I maintain my present course? If you will still be struggling with debt, then bankruptcy may be your best option.
Bankruptcy is designed to get you out of debt, to get you a fresh start. It is your first step toward repairing credit that has been damaged and setting the stage for a positive financial future. Our Attorney at the law firm of Hickson Law, PC, in Austin, Texas, who is certified in Consumer Bankruptcy Law by the Texas Board of Legal Specialization is here to guide you through the process.
Bankruptcy will appear on your credit report. Chapter 7 bankruptcy will be reported for 10 years. Chapter 13 bankruptcy will be reported for seven years. This does not mean that you have to wait that long to start rebuilding your credit.
After you have filed bankruptcy, there are any number of steps you can take to begin rebuilding your credit, such as getting a small, safe credit card and using it carefully, paying all bills in a timely manner. Anything that establishes a payment history will help. Since you have filed bankruptcy and made it clear that you are trying to make a positive change, and because you cannot file bankruptcy again
for a significant period of time, creditors may consider you a fairly low risk. You may be surprised just how soon you are able to get the credit you need.