One of the biggest concerns people often have when considering whether to file for bankruptcy, is the effect it will have on their credit score. The main effect bankruptcy initially has on your credit score immediately upon filing for bankruptcy, depends in large part on how high your credit score was prior to filing.

“What effect will filing bankruptcy have on my credit score?” is probably the most common question I get during my first consultations with Minnesotans. My response starts with: “what is your current credit score now?”

If you live in Minnesota and you are suffering from overwhelming debt, you get the stress of debt. Debt is suffocating and can make a good day really bad. Most of us cannot tolerate having our wages garnished or bank account levied. If you are struggling to pay your bills before being collected against, try paying your bills when your wages are being garnished and your accounts levied. Not good.

Once a bankruptcy case is filed, the debtor is protected by what is known as an ‘automatic stay.’ This is a fancy legal term that essentially means that all creditor communication with the debtor must stop. This also stops all further collections actions from creditors that are listed on the debtor’s bankruptcy petition. Once this automatic stay is in place debtors don’t have to worry about creditor calls, letters, or collections –it’s a powerful thing, the automatic stay. 

Chances are your bankruptcy case is going to be filed and you will receive your discharge with nothing more than one or two natural and easy to resolve hiccups along the way. But what if there comes along a little complication post-petition filing? A concerning letter from the bankruptcy court or a misstep during your Chapter 13 payment plan? No need to worry! We have got you covered. Just because your case has been filed does not mean that you have gotten rid of us just yet! There are many things that may or may not pop up after your case has been filed that we are able to help you through. Never hesitate to ask or to reach out!

Many people believe that if you file Chapter 7 Bankruptcy you will ruin your credit forever and you can basically forget about ever getting credit again. This is complete and utter nonsense and here's two reasons why...