How many points does a credit score drop when you file bankruptcy?

[vishenda]

what other impact does it have on credit?

[mbhunter]

No one will be able to predict how many points your rating will drop, but suffice it to say it will be enough that your interest rates will get extremely expensive, if you're extended credit at all. That, and it will stay on your credit report for up to 10 years.

[PRICEPLUS]

Ever hear the expression "drop like a stone". Interestingly enough you'll be sure to get planty of CC offers as you can't declare bankruptcy again for several years. Any new debt you incur would find you securely on the hook!

[Jeff78703]

It won't drop at all for filing bankruptcy. It will only drop once your bankruptcy settlement is approved and it goes onto your credit. Keep that in mind because it isn't so easy to file these days...

[bjl584]

It will drop signifigantly enough that you will be considered a high risk customer by most lending institutions. You may still get extended credit, but at a high interest rate and unfavorable terms.

I'm going to guess that if you are considering bankruptcy, that your credit score is already low anyway?

[JoshuaHeckathorn]

For the first time ever, FICO recently released examples of how many points would be lost when a BK hits your credit reports. For someone with a FICO score around 680, the range was 130-150 points. For someone with a higher credit score of 780, the hit would be worse- 220 to 240 points. Exactly how many points you can expect to lose will depend on your specific credit profile, but these are the best estimates we have to go by.

Like others have said, your FICO scores will obviously get hit hard and you will be considered a high lending risk for quite some time. It's not the end of the world though. Many people are able to get their credit scores back to an acceptable range within 2-3 years.

[Joan.of.the.Arch]

Originally Posted by JoshuaHeckathorn

Many people are able to get their credit scores back to an acceptable range within 2-3 years.

If that's the case, then the original poster may already be in the clear, as this question was posted more than 4 years ago.

[cjscully]

Originally Posted by Jeff78703

It won't drop at all for filing bankruptcy. It will only drop once your bankruptcy settlement is approved and it goes onto your credit. Keep that in mind because it isn't so easy to file these days...

This statement is incorrect. Bankruptcy filings are public records and often end up on credit reports, resulting in lower credit scores. Additionally, if the bankruptcy is dismissed (as opposed to being discharged) this is also usually included in a credit report. In this case the score damage is only part of the issue. A dismissed bankruptcy is still pretty derogatory and will have to be explained in any mortgage application the person submits for the duration of the time it's on the credit report regardless of credit score.

Originally Posted by bjl584

I'm going to guess that if you are considering bankruptcy, that your credit score is already low anyway?

This is usually the most salient point for people considering bankruptcy. It's not something someone considers when unless they've fallen seriously behind financially and don't see another way out. If someone has numerous collection accounts, maybe a couple of lawsuits, their credit score could already be sub 600. The addition of a bankruptcy to such a credit report will depress it a bit more, but at that point what does it matter? The credit score is actually the least important consideration in such circumstances.

Originally Posted by Joan.of.the.Arch

If that's the case, then the original poster may already be in the clear, as this question was posted more than 4 years ago.

Funny, I saw that too but then I saw some of the statements posted today and decided they needed a bit of context.

[JoshuaHeckathorn]

Originally Posted by Joan.of.the.Arch

If that's the case, then the original poster may already be in the clear, as this question was posted more than 4 years ago.

Uggh...I hate when someone revives an ancient post with a response like it was brand new. Well, maybe the new info. released by FICO will help someone else looking for an answer to the same question.

[disneysteve]

Originally Posted by JoshuaHeckathorn

Uggh...I hate when someone revives an ancient post with a response like it was brand new.

Me too. And it is usually a new poster or worse a spammer.

New folks: We welcome you to join and participate but please don't dredge up ancient threads. There are plenty of current ones to join in on.

[krantcents]

Originally Posted by vishenda

what other impact does it have on credit?

Are you thinking of filing for bankruptcy? My attorney told me that bankruptcy should be avoided as much as possible. Maybe examine how to avoid it rather than looking how your FICO score will change

[Wystan]

I think krantcents is right. If you will file for bankruptcy than you will face problems in future in applying for any applications. So before taking any step contact to the bankruptcy attorney.

[cicy33]

Originally Posted by disneysteve

Me too. And it is usually a new poster or worse a spammer.

New folks: We welcome you to join and participate but please don't dredge up ancient threads. There are plenty of current ones to join in on.

While I did notice with interest that the poster has a banned status, I do feel that just because people on here have seen the post 4 years ago! alot of other people haven't. Especially new people. or like me who has been really busy the past couple weeks or so and has probably missed out on a few of the interesting posts. What if someone asked the question with true interest? I don't recall seeing this specific post but then again, I don't spend a whole lot of time on here. I know that sometimes there are people who revive old posts for irritation but perhaps sometimes it is good to educate the new posters too. People come here for information. they don't always know what has been discussed 4 years ago. so these posts do help sometimes. actually I found it interesting.