Times are tough and it seems like people and companies are filing bankruptcy left and right–but is bankruptcy right for you?

I’ve teamed up with a Total Bankruptcy contributor to bring you some facts about filing bankruptcy.

What Happens to My Credit After Filing Bankruptcy?

Most people considering bankruptcy wonder how filing for bankruptcy will affect their credit. Before you make a major financial decision, make sure you do your research:

1. Bankruptcy and Your Credit Report:

A bankruptcy filing will stay on your credit report for 10 years. This may seem like a long time, but consider this: as time passes (and you develop healthy credit habits), the effect of bankruptcy on your overall credit rating often diminishes greatly.

2. Borrowing After Filing Bankruptcy:

You may fear that filing for bankruptcy will ruin your chances of ever borrowing money again, but when you think about it, how easy has it been getting new loans when creditors see you are delinquent on your current payments?

Most lenders will review your credit history, but recent credit action tends to matter more than old credit action. In other words, staying out of unnecessary debt after your bankruptcy can have a positive impact on how lenders view you.

3. Loans After Bankruptcy:

It’s certainly possible to obtain loans after you file for bankruptcy. Total Bankruptcy has nationwide online relationships with lenders who are friendly to bankruptcy filers.

4. Credit Cards After Filing Bankruptcy:

You may think that you’ll never want another credit card again, but the truth is, you’ll likely need a credit card after bankruptcy to help establish a strong credit history. Find out how to avoid credit cards that cost too much – and find ones that will help you stay on your feet.

Learn more about filing bankruptcy.

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