Most negative credit events stay on your credit report for seven to ten years — which means they affect your credit score for just as long.
To check the accuracy of your credit report and to ensure that negative records are indeed removed no later than ten years after the fact, you can get a free credit report (minus the proprietary credit scores) once a year from a central location, annualcreditreport.com. Otherwise, you can request your credit report and score from any or all of the three credit reporting agencies—Equifax, Experian, and TransUnion—but you will have to pay to see your credit score.
In personal bankruptcy filings, debtors usually choose between Chapter 7 bankruptcy and Chapter 13 bankruptcy. After you declare bankruptcy, how long potential creditors can see the bankruptcy on your credit report depends on which sort of bankruptcy you declare.
- In a Chapter 7 bankruptcy, the bankruptcy trustee sells your non-exempt assets and uses the proceeds of the sale to pay off your creditors. Once completed, the process results in forgiveness — or discharge — of your unsecured debts. A Chapter 7 bankruptcy usually ends just a few months after it begins, so the bankruptcy falls off your credit report within ten years and a few months of the time you first declare bankruptcy.
- In a Chapter 13 bankruptcy, you get to keep most or all of your assets. A bankruptcy trustee and a judge help you determine how much of your unsecured debt you can pay off over a three to five-year period while you continue to make payments on your secured loans. At the end of the repayment period, any outstanding unsecured debt is discharged. A Chapter 13 discharge stays on your credit report for 7 years from the date of your discharge.
Since a Chapter 13 plan may last longer than 3 years, Chapter 13 bankruptcies may stay on your credit report longer than Chapter 7 bankruptcies. On the other hand, potential creditors may prefer to make loans to people who strive to repay debts even in difficult times, balancing out the negative effect of the bankruptcy remaining visible on your credit report for longer.
Even if the bankruptcy remains on your credit report, you can immediately take steps to rebuild your credit score. An experienced Pennsylvania bankruptcy lawyer can tell you how.