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Will Filing For Bankruptcy in New York Ruin My Credit Score?

Financial anxiety can impact every aspect of your life. However, it’s important to understand that you are not alone in your struggle with debt. Many individuals, families, and businesses have found themselves facing significant debts exacerbated by the pandemic. If you’ve considered filing for bankruptcy, you may be worried about how this action would affect your credit score. Here’s what you need to know about the impact of bankruptcy on your credit score and how to select the debt relief option that best suits your needs.

Assessing Your Current Credit Score

While bankruptcy does impact your credit score, it does not ruin it. However, you will need to take steps to rebuild it once you have filed for bankruptcy. Many people are anxious to know how much the bankruptcy process will impact their credit score, and this all depends on what their current score looks like. For those with a 780 credit score and no late payments, bankruptcy can significantly impact your credit score. Most people filing for bankruptcy, however, do not have a 780 credit score. If you are struggling with late payments, your debt-to-income ratio is likely less than ideal. One of the benefits of filing for bankruptcy is that the process puts a stop to debt collections, giving you the space you need to develop a plan for repaying your debt.

Rebuilding Your Credit After Bankruptcy

Many people assume that bankruptcy will destroy your credit permanently. This is not the case—bankruptcy allows you to obtain a fresh financial start, from which you can start to rebuild your credit immediately. Before you start worrying about rebuilding your credit, it’s important to take the necessary steps to identify the bankruptcy relief option that best supports your needs. Enlisting the guidance of a knowledgeable New York bankruptcy attorney can give you the confidence you need to make informed decisions. After you’ve moved through the bankruptcy process, your attorney can help you develop a concrete plan for rebuilding your credit. If you follow the necessary steps, you can start to see your credit score increase within six months or so.

Explore Your Bankruptcy Options Today

Unfortunately, a stigma about bankruptcy persists to this day. Many people consider bankruptcy an embarrassing or even shameful act when the process actually allows you to obtain the fresh financial start you need. If you are struggling with large amounts of debt, reach out to a trusted and compassionate bankruptcy attorney to discuss your options. Your attorney will listen closely to your goals and help you develop a strategic plan to move forward.

Call Grady BK, PLLC, today at (315) 299-9005 to discuss your debt relief options with a skilled and compassionate New York bankruptcy attorney.