Does Filing For Bankruptcy Stop Bad Credit? - Limited/Bad/Fair Credit Questions


ADVERTISING DISCLOSURE: is an independent, advertising-supported web site. receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » Questions » User Questions » Limited/Bad/Fair Credit » Does Filing For Bankruptcy Stop Bad Credit?

Does Filing For Bankruptcy Stop Bad Credit?

Answered on | Updated on June 3rd, 2010
The content is accurate at the time of publication and is subject to change.

Many people find themselves dealing with financial debts. There may be unpaid mortgage, car loans, credit card debts to settle and other issues. However it is not necessary that you have to declare bankruptcy when you have a lot of debt to settle. There are numerous organizations that will offer you free debt counseling or even paid services. Many even claim that they will help you recover from your losses.

Personal bankruptcy is a very huge decision and if you decide to file for it the repercussions will be for life. For one thing creditors will no longer work with you in the future. While all intimation regarding payments and all contacts will stop you can still expect to have to pay off at least half of the debt. This would mean that you will have to sell off as much as you can of your personal assets to settle the debt. In case a bankruptcy proceeding is taken up against you or you are thinking of filing you must be thoroughly aware of what proceedings are involved and what you need to do beforehand.

Personal bankruptcy gives people an opportunity to make a new start if they have incurred huge losses that they are unable to pay back. When an individual declares himself as bankrupt there are many restrictions placed on them following that. Life does not get easier or simpler, rather it will be quiet difficult to move things forward in terms of your finances particularly. You do not get off easy with your personal debt and you will have to pay up what you owe in terms if whatever assets you can liquidate. The wages you earn will also be turned to creditors and banks so that you can close your debt.

While many of your personal assets will be sold to pay for the dues settlement following filing of bankruptcy, you can keep some of your basic furniture. A vehicle is also allowed to the person to drive to work and back. If you are applying for a bankruptcy proceeding then it is important that you keep yourself well informed about what is ahead. You do not want to have unpleasant surprises. There are also different types of bankruptcies that people file for. As part of the procedure you will also have to compulsorily attend debt relief counseling from the authorities without fail. Think carefully and assess your options before you apply.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Perfect credit not required for approval; we may approve you when others won’t
Fair/Bad Credit
Instant $500 Credit Line. No Credit Check.
Bad Credit
Monthly reporting to the three major credit bureaus
Fair/Bad Credit

Other Questions in
Limited/Bad/Fair Credit

You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!