There are only three credit reporting agencies. Weather you like it or not, they are constantly monitoring your financial activity. Based on many factors such as how quickly you pay your bills, and how much outstanding debt and past due debt you have, each agency will grant you a credit score. If you have a good score, you will be approved for loans at good interest rates. But it can also affect things such as your insurance rates, and whether or not you get hired at your new job.
Not everyone thinks credit is a fair system, but regardless of the way you feel, it’s the system we must to deal with.
If you are contemplating bankruptcy, it’s a great idea to pull your credit before filing. Knowing how much debt you have will help you determine if bankruptcy is worth doing in the first place.
If you then decide to file bankruptcy, you should thoroughly review all of your debts. The court requires you to list anything that is on your credit report that does not have a zero balance. This includes debts that have been assigned to collection agencies and even debts that are listed as “charged off.”
Don’t be surprised if you find a lot of errors on your credit report. Even though these agencies can make or break your financial future, they are surprisingly inaccurate. Filing for bankruptcy creates a great opportunity to eliminate even the incorrect debts that you supposedly owe on your credit report.
The easiest way to get your free credit report is to go to annualcreditreport.com. It’s sponsored by the government and will allow you to get a report from each of the three credit bureaus free of charge once a year. They won’t give you your credit score for free, but if you are considering bankruptcy, then you probably can assume your credit score isn’t worth worrying about in the first place.
Be wary of other websites offering free credit reports. There is usually a catch involved, and you’ll end up either having to pay for your report, or you’ll have to sign up for some kind of credit monitoring service.
Your bankruptcy attorney will likely be checking your credit report as well. So between the two of you, you shouldn’t miss any creditors. However, if you forget to include a creditor, they can still be added to your bankruptcy after it has been filed. This is only for a limited time and there are fees involved, so it pays to get them all listed before filing.
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A few months after filing for bankruptcy, it is a good idea to get a copy of your credit report again. All of your old debts should be listed as being “discharged in bankruptcy.” If you have any debts that are not listed this way, you should contact each credit bureau, provide them with proof of your bankruptcy filing, and ask them to fix the error.