How Bankruptcy Impacts Your Credit Score

Declaring bankruptcy is a serious event for anyone, and it will negatively impact the numbers on your credit report. The severity of that impact, however, depends on several factors already in the report. For example, if you have a good credit score, then your score will likely see a huge drop. On the other hand, if your score has had a number of negative marks, then a bankruptcy will probably cause a much smaller drop in your rankings.

The Differences Between Foreclosure and Short Sale

There are alternatives to foreclosure, including short sales and deeds-in-lieu of foreclosure. It is important for you to know that not all of these are “paid as agreed” accounts, which means that they will not impact your score equally. Be sure to talk with our FICO experts to determine which one of these is right for you or if there is another option that might be better for your financial situation.

It’s important to know that declaring bankruptcy may have a greater impact than a foreclosure on your credit score. The reason for this is that a foreclosure is a single account on which you have defaulted, but declaring bankruptcy may affect multiple accounts.

360 Credit Consulting can provide the expert advice and help that you need to make the financial decisions that will be best for you both now and in the future. Whether you have already gone through a bankruptcy or foreclosure, or you are anticipating one, be sure to call today and let us help guide you to a better credit score.