When Bankruptcy Does Not Mean a Fresh Start on Your Credit Report
Reestablishing credit after a bankruptcy discharge is no easy task. Bankruptcy is meant to offer a fresh start with a chance to rebuild your financial life. However, many times the promise of a fresh start is eliminated by inaccurate consumer credit reports related to accounts that should have been included in the bankruptcy. This is not a minor problem because many creditors are reluctant to deal with consumers that have previously filed bankruptcy and charge higher interest rates if they do make a loan. When Experian, Equifax, and TransUnion report inaccurate credit accounts after a Chapter 7 or Chapter 13 discharge, the results can be devastating for the consumer.
Common Credit Reporting Issues After Bankruptcy
Blankingship & Christiano, P.C. has assisted consumers that had inaccurate information on their credit reports after Chapter 7, 13, and 11 bankruptcies. We help people with significant material credit reporting errors. Examples include a creditor not reporting that a balance was discharged in bankruptcy, so the account appears as a current delinquent charge-off. Additional examples include the credit reporting agencies knowing the details regarding the bankruptcy and still reporting that an account was not included in bankruptcy or that an account’s status remains past due when the credit reporting agency knows the account was discharged in bankruptcy.
Errors That Undermine Your Fresh Start
Imagine finally getting through the bankruptcy process obtaining a discharge with a legal declaration that certain debts are included and no longer collectible. You envision a credit report where the old accounts are marked as “discharged in bankruptcy” with current new accounts showing that you are reestablishing yourself as a good credit risk. However, all too often the reality is different because a prior creditor or the consumer reporting agency fail to update the accounts. Old, discharged balances remain reported as past due and currently owed with the “discharged in bankruptcy” notation missing. These errors effectively deny the fresh start offered by the bankruptcy process.
Real Consequences for Consumers
Our experience indicates credit report errors after bankruptcy have tangible and detrimental consequences. An inflated debt-to-income ratio due to incorrectly reported balances can make it impossible to secure new housing, obtain a car loan, or even get approved for a basic credit card. Employers, landlords, and lenders rely heavily on credit reports, and inaccurate information can lead to denied applications, higher interest rates, and lost opportunities. It can feel like you’re trapped in a financial purgatory, perpetually burdened by debts you’ve already paid or legally discharged.
What Consumers Can Do
Consumers that we have helped correct inaccurate credit reports after bankruptcy have had success by following a process that includes obtaining your credit reports from Experian, Equifax, and TransUnion. It is important to obtain all three as each credit reporting agency can report different information related to the accounts discharged in bankruptcy. If a consumer finds an error related to discharged accounts, they should act immediately. Send detailed dispute letters including providing documentation of your bankruptcy discharge. If your efforts are met with resistance or inaction, remember that legal recourse may be available under the Fair Credit Reporting Act. Blankingship & Christiano assists consumers with inaccurate credit report information after bankruptcy and would be happy to speak to you about your particular situation.
Contact Blankingship & Christiano
At Blankingship & Christiano, P.C., we exclusively represent consumers in matters involving credit reporting errors, identity theft, credit report disputes, and employment background check issues. We are located in Northern Virginia, and we help consumers throughout Virginia, Maryland, and Washington, D.C. Contact us today for a free case review.
