How to file for Chapter 7 or 13 and rebuild credit
How to file Bankruptcy Louisville Kentucky
The final step of the process after attending your Kentucky hearing and discharge is to reestablish your credit after you file for bankruptcy. Every debtor will need to eliminate inaccurate credit information from their file after they file for Chapter 7 bankruptcy. Your credit will more quickly repair itself after a Chapter 7 bankruptcy than if you file a Chapter 13. In a Chapter 13 or in a Debt management plan the process is not over until years after you file the Chapter 13. During the time you are in a Chapter 13 your credit is not improving and it is continuously being reported as being not paid on time. The Chapter 7 bankruptcy process is designed to allow you to start life over faster and on a budget that you can live with.
In order to qualify for a mortgage your credit score will normally need at least a 620 FICO score. Also your discharge will normally need to be over 2 years and any foreclosure sale will need to be over 3 years old. Some people have been able to refinance their homes shortly after 1 year after a Chapter 13 is filed during the plan and technically some people have been able to obtain mortgage at a prime rate while they are in a Chapter 13 if payments are made on time. To qualify for a reasonable interest rate mortgage a debtor will need to pay their debts on time for a reasonable period of time. Federal regulations allow people to qualify for these programs 2 years after discharge for FHA mortgages.
A Debtor has the ability to contest outdated misleading and untrue information. Some people have used services like Lexington law to sweep their credit file. By filing and disputing negative information over and over until it is removed much of the negative information on a credit report can be eliminated. Also as information gets older it has less and less impact on the credit score. About 40 per cent of all credit reports have serious enough errors that they will be denied on a credit application. A poor score can be used to deny a person a job or may increase the cost of their car or home insurance.
Attorney Nick C. Thompson Louisville Kentucky How to file for Chapter 7 and Chapter 13 Bankruptcy
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