Rebuilding Your Credit After Bankruptcy: How One New York Attorney Helps

After filing for bankruptcy, most good attorneys discuss how to rebuild credit with their clients. What most debtors don't realize is that rebuilding someone's credit, if handled correctly, can happen within six months to a year after filing for bankruptcy, according to one New York attorney, who says that understanding your credit score and whether or not you can file again in the future should always be part of the process.

Understanding your credit score

When an individual falls behind on their debts, all types of negative credit information is placed in their credit report. Elliot Schlissel, a New York bankruptcy attorney, says that if you fall behind on your mortgage, credit card or car payments, your credit score goes way down. However, filing for bankruptcy can actually help most people in the long run as they can develop good credit afterward. He explained:

After you file bankruptcy New York and you’re discharged, you have no debt. If you enter into an agreement for a secured credit card or other arrangements of that nature, you can rebuild your credit score. Individuals I’ve handled bankruptcies for a year down the road have 750 credit scores because they have no debt. They’re debt-free and they’ve been able to reestablish credit and show that they’re making payments to their creditors on a timely basis.

Good New York bankruptcy attorneys who want to have long-term relationships with their clients should discuss rebuilding their client’s credit. It is something we always do for our clients. We feel that it’s part of the process of educating them on how to rebuild their credit after the bankruptcy is over.

Consequences of filing more than once

In the event that one does run into financial troubles again, it is worth noting that a second (or third or fourth) bankruptcy filing is possible and may be advisable, based on circumstances, according to Schlissel, but he says that time limits do apply. “The waiting period after a Chapter 7 bankruptcy discharge is 8 years for another Chapter 7 discharge, but only 4 years for a Chapter 13 discharge. However, if you received a Chapter 13 discharge, the waiting period is 2 years for another Chapter 13 discharge and 6 years for a Chapter 7 discharge.”

Click here for additional information on the differences between Chapter 7 and Chapter 13 filings.

Schlissel says that there are no consequences to filing for bankruptcy more than once in your lifetime. In fact, he told us that debtors should understand that it is against the law to discriminate against individuals because they file bankruptcy.