Our bankruptcy lawyer Springfield, IL offers from Pioletti Pioletti & Nichols wants you to know that bankruptcy is an opportunity for you to have relief from financial debt, it is not supposed to be an opportunity for you to stress more or worry about your reputation. When you are filing for bankruptcy, one of the things you may have on your mind a great deal is what this will do to your credit score and how you can possibly rebuild your credit score. It is possible for bankruptcy to help your credit score and improve your financial standing. To learn more about how bankruptcy is related to credit, reach out to our office now.
What does a credit score do exactly?
Many people do not realize how big of a role credit scores play in getting them certain things in life. Your credit score is a number that tells you and others what your financial history is. This helps creditors know whether you are likely to pay your debts off or not. So, if you have a high credit score, it means that you have a good track record of holding credit and paying it off on time. If your score is low, creditors will likely not want to lend you money because they know that you will not pay them back. Credit scores can consist of information like:
- What types of credit cards you have
- What you have paid off
- What your current amount of debt is
- How long credit has been established in your name
What does bankruptcy do to your credit score?
Our Springfield, Illinois bankruptcy lawyer knows that bankruptcy is typically considered one of the worst things that you can do to your credit score. However, if you file for bankruptcy and it gets rid of delinquent accounts or high credit card balances you had not paid off, then filing for bankruptcy can help your credit score a great deal. If you are starting out with a low credit score, this can certainly give it a boost. While this is a short-term positive effect, it can also help you long term as you re-establish good credit without starting off with bad credit because of serious debt.
If you would like to learn how bankruptcy can positively affect your credit and what you can do during this process to get off on a better financial footing, contact Pioletti Pioletti & Nichols to speak with our bankruptcy lawyer in Springfield, Illinois now.