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Older bankruptcy has less impact than expected on credit reports

The first step to correcting and improving one's credit score is to obtain a copy of the credit report and examine it thoroughly. Although a bankruptcy technically may be reported for between seven and 10 years in Arkansas and elsewhere, there may be several inaccuracies or incorrect entries on a credit report that a person can correct on his or her own. Each type of credit blemish has a reporting window during which it can appear on your record.

For example, late payments may be reported for up to seven years, even if the account is currently up to date. Other items that can be reported for a number of years, and which can hurt a person's record and score, are unpaid judgments, collection accounts and unpaid tax  liens. However, there are often inaccurate dates, amounts and other details associated with the items reported.

When one files an online objection to incorrect entries, the credit reporting agencies must conduct an investigation. If the agency cannot validate the account or the matter objected to within 30 days, the agency must remove it. Often, the agency is unable to obtain any information, and it will eliminate the account from the person's record. By going through the regular procedure of examining one's credit record and making objections, many negative items may be changed or eliminated entirely.

Each time an inaccuracy is removed, there  is a positive effect on one's report and score. With respect to the 10-year rule regarding bankruptcy reporting, in reality it turns out not to be as damaging as one may think. According to an Experian spokesman, the further in the past the bankruptcy took place, "...the less impact it will have on credit scores and lending decisions."  Arkansas residents may find that filing a bankruptcy to eliminate debt and get a fresh start is compatible with improving their credit positions within reasonable period of times after their cases are discharged.

Source: stltoday.com, "How Long Does It Take for Something to Be Removed From My Credit Report?", Constance Brinkley-Badgett, Jan. 26, 2016

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