QUESTION
What should I expect after a Chapter 7 discharge?
Asked on Jun 02nd, 2011 on Bankruptcy - California
More details to this question:
When I receive my discharged from filing Chapter 7 bankruptcy, what should I expect in regards to my credit score, applying for a car loan and applying for a house loan? Also, what is my next step after I receive my discharge?
10 ANSWERS
Spencer Hale
Once you get your discharge, you can apply for credit as you would normally do. There really is no next step. However, keep in mind that the discharge is not necessarily the end of the bankruptcy. If the trustee is waiting for you to turn over property, you still need to do this before the bankruptcy can be closed.
Answered on Jun 07th, 2011 at 4:48 PM
Litigation Attorney serving Portland, OR
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Daniel G. Hoarfrost
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Your next step after discharge is to live your life and try to stay out of debt problems. Credit scores and loan applications are determined primarily by your income situation and your ability to demonstrate that you can make the required payments.
Answered on Jun 07th, 2011 at 1:07 PM
Bankruptcy Attorney serving Jacksonville, FL
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Robert L. Peters, Attorney
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I would suggest that you get us to pull your credit and make sure that all accounts are reflected properly. For example discharged debts should show as discharged not past due or in collections. We have a process that forces the credit bureaus to properly reflect your bankruptcy and nothing more.
Answered on Jun 06th, 2011 at 2:06 PM
Bankruptcy Attorney serving Herndon, VA
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Maureen O'Malley
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Lawyers differ in regards to credit after bankruptcy. Your score will take a slight dip, but if you're working and don't apply for more credit it will increase because there will be no more late accounts showing. I wouldn't suggest applying for a car or house loan for at least 2 years; you might be able to buy a car, but the interest will be skyrocketing. I don't even advise applying for a secured card, as they often charge up-front fees and it would be in your best interests to live with cash for awhile. My advice for after discharge is to get copies of all your credit reports and ensure that everything is shown as "included in bankruptcy," with no debts shown as current. Your house and your car will show as included, as well; on these, request a statement from your creditor each year to show that you've paid on time and then send that to the credit reporting agency.
Answered on Jun 06th, 2011 at 2:06 PM
After the discharge, your credit score will increase as your worthiness and credit is rebuilt. Typical turnaround time for a car loan is six months, a house, two years.
Answered on Jun 06th, 2011 at 12:28 PM
Bankruptcy Attorney serving Cleveland, OH
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Benson Law Firm
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If you are considering the purchase of a major asset like a house or vehicle, you may want to work with a credit score consultant. Some of my clients have used one that charges $375 ($475 for a couple) to work with them over the course of a year. He claims that during that time, a score can be improved by as much as 100 points and that purchasing a house is possible in certain circumstances within 3 years.
Answered on Jun 06th, 2011 at 9:25 AM
Glen Edward Ashman
Your question seems to indicate that you made the catastrophic mistake of filing without a lawyer. Your lawyer would have addressed these questions with you. The answer is one you will not find here as your specific numbers and situation dictate what effect a discharge will have on you and what you should do to maximize your score.
Answered on Jun 03rd, 2011 at 2:06 PM
Honestly, your credit will be limited for some time. Some credit grantors will not issue credit if you have a bankruptcy, some will. If you get credit then be careful and pay your bills on time and stay well within your limit - no more than 30% card utilization. A car loan may be a good idea, if you can qualify but the interest rate will likely be higher and they may even require a co-signer. A home loan is not unheard of but probably not a reality for at least 2 years.
Answered on Jun 03rd, 2011 at 12:07 PM
Bankruptcy Attorney serving Concord, CA
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William Rubendall Attorney at Law
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After your discharge you can expect it will take awhile to built up your credit. Presumably, after you have filed bankruptcy you don't have debts and you should be able to pay in cash or save money for major purchases. Check you credit report about every six months. You can buy a car or even a house but expect the minimum requirements to qualify to be higher than if you hadn't filed bankruptcy. You can also expect a higher rate of interest.
Answered on Jun 03rd, 2011 at 12:00 PM
Bankruptcy Attorney serving Hayward, CA
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Carballo Law Offices
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Your credit score should automatically improve within two years of the discharge and you can improve it quicker by obtaining credit and paying on time. Most people are offered credit cards and other types of credit shortly after bankruptcy assuming they have good income. Most likely you will not be able to obtain a mortgage for at least two years after bankruptcy. It might take three to four years of credit rebuilding efforts to obtain a reasonable mortgage. Car loans will be generally available easily shortly after bankruptcy but at a higher cost and with more down payment required.
Answered on Jun 03rd, 2011 at 11:40 AM