When Arizona residents file for bankruptcy, one of their first concerns is how to repair their credit rating. One of the main goals of personal bankruptcy is to get people out of a bad financial situation, and eliminating debt can give people a clean slate. This is why it is essential for people to check their credit report soon after their bankruptcy filing has been completed.
Between 2005 and 2006, many individuals ran into problems with credit reporting agencies. Discharged debts were still being listed as delinquent accounts on credit reports, and the agencies in question did not always resolve these errors when they were pointed out. To address the issues, a class action lawsuit was filed against several major reporting agencies. As part of an agreement, the companies in question instituted new processes for dealing with the credit reports of individuals who had successfully filed for bankruptcy.
Even with outstanding balances on someone’s credit report, they can still begin to rebuild their credit after a bankruptcy. While bankruptcy does represent a black mark on someone’s credit report, simply staying up to date on current debts can go a long way towards improving people’s credit scores.
Filing for bankruptcy can help restore people’s financial peace of mind, but it is important that it is filed correctly so people ensure all possible debts are discharged. Individuals may want to consult an experienced bankruptcy attorney to find out the best way to proceed and whether Chapter 7 or Chapter 13 is best for their particular situation.
Source: New York Times, “Credit Reports More Accurately Reflect Debts Discharged in Bankruptcy“, ANN CARRNS, April 30, 2013