I am routinely asked as a Maple Park bankruptcy lawyer, if after filing bankruptcy, will the negative items be removed from a credit report? Everyone is concerned about credit these days. Everybody is obsessed with pulling the credit report and seeing what’s on it. Some people are even paying for information regarding to the actual credit score when they’re filing for bankruptcy. In my opinion, the credit score means absolutely nothing if you’re filing for bankruptcy. The bankruptcy is going to eliminate the debt and give you a chance to start over. It really doesn’t matter what your credit score was before you filed for bankruptcy because the bankruptcy itself is going to affect the score. I have countless people who come into my office before filing Chapter 7 bankruptcy and tell me that they have A-1 perfect credit; they can’t believe they’re going to file for bankruptcy. I ask them how much they have in terms of debt. The answer might be anywhere from $50,000.00 to $100,000.00 worth of credit card debt, but they’re making the minimum payments and juggling the cards. I say to that person, “Look, I don’t care what your credit score is. I don’t care if you think you have perfect credit. You shouldn’t care if you have perfect credit because you’re carrying too much debt, and that’s why you’re in my office seeking bankruptcy protection.” So please, don’t be so concerned about the credit report or the credit score before you file for Chapter 7 bankruptcy. It really means nothing except the fact that we use the credit report to determine who is owed money. We utilize the credit report to assist in the bankruptcy process.
Now, after the bankruptcy case is filed, creditors cannot report the debt as outstanding. Creditors cannot pursue the individual for collection. Creditors cannot take collection efforts and harass the debtor. After the bankruptcy case is filed, I recommend that my clients pull their credit report to see if items have been properly notated as being included in a bankruptcy or discharged in a bankruptcy or otherwise related to a bankruptcy case. In the event that creditors are still reporting the debt due and owing, clients have an opportunity to dispute that debt in writing or online with the individual credit bureaus. The information will eventually be removed from the credit report in the sense that it will not say it’s still due and owing. However, the items will still be listed on the credit report. In other words, the credit report doesn’t become clean without any items or notations on it. It simply turns into a different instrument where instead of showing due and owing, the creditors will then report that that account or that debt was included in a bankruptcy claim and thus it will not report an amount due.