Bankruptcy Blog

How long does bankruptcy stay on your credit report?

When debt becomes overwhelming and you’re considering your options about what to do next, bankruptcy may be a solution. But you could be asking yourself, “how long does bankruptcy stay on your credit report?” It is true that bankruptcy will significantly impact and lower your credit score. How great the drop in your score could be depends on several factors. The important thing to keep in mind is that completing a bankruptcy gives you a fresh start, which means you can begin rebuilding your credit quickly.

A Chapter 7 bankruptcy will remain on your credit record for up to 10 years.  A Chapter 13 bankruptcy will stay on your credit record for up to 7 years.  However, the negative impact on your credit score will diminish over time.  A skilled and affordable Indianapolis bankruptcy attorney can help you decide whether Chapter 7, Chapter 13, or another bankruptcy chapter is the most advantageous for your individual circumstances.

Drowning in debt is a terrible feeling. Attorney Jerry E. Smith can help. He has helped hundreds of clients get back on their feet and step forward on a stronger financial footing. A brighter future awaits! To find out more about how we can help you, call us for a free one-hour initial consultation at (317) 917-8680. We offer weekend and evening appointments as well as same-day filings if possible.

Get Hope. Get Help. Get Peace of Mind.

How long does bankruptcy affect your credit?

Getting in trouble with too much credit card debt

Some of the most significant debt among American households is credit card debt.  The average credit card debt per U.S. family is $6,270.  Overall, Americans owe $807 billion across almost 506 million card accounts, according to ValuePenguin by Lending Tree.  The average credit card debt among borrowers in Indiana is $4,651.  Hoosiers tend to be some of the lowest debt-holders in the nation, coming in at 45th among all 50 states.  Alaska and Connecticut residents hold the highest credit card borrower debt.

Bankruptcy can affect your credit for quite some time after a bankruptcy is discharged. However, there are some things you can do to position yourself favorably to start rebuilding a good credit history. First and foremost, avoid taking on any new substantial debt. Don’t dig a new hole after getting out of the old hole. Taking on small, modest debt over time can help you build your credit score by making payments regularly and on time. offers some helpful tips about minimizing the negative effect of bankruptcy and how to revive your credit after hard times.

Some of these tips are:

  • Check your credit report to make sure that accounts that were not part of the bankruptcy are not being reported with a bankruptcy status.
  • Make sure your bankruptcy is removed the moment it is eligible to be “purged” from your credit report.
  • Late payments and collections can also stay on your credit report for up to 7 years.  If you pay these off, make sure they are removed from your credit record if possible.
  • Obtain a “secured credit card” (one in which you put up the cash behind it) and continually make these payments on time. As time passes and the impact of the bankruptcy lessens, you may apply for a traditional credit card.

When is Chapter 7 bankruptcy removed from your credit report?

Chapter 7 bankruptcy is the most common and simplest type of bankruptcy protection for individuals. It is often referred to as “liquidation bankruptcy,” which means that assets are often sold to pay secured debt to creditors. Chapter 7 is also sometimes used by small businesses. After liquidating assets to pay secured debt, most or all of your unsecured debt is discharged. This includes credit cards, personal loans, department store credit, and other similar debt. Student loans, alimony and child support typically cannot be eliminated through bankruptcy.

Typically, a Chapter 7 bankruptcy can be completed within a few months. After your bankruptcy hearing, the Chapter 7 is then discharged. This bankruptcy will stay on your credit record up to 10 years from the date of bankruptcy filing.

How long does a dismissed Chapter 13 stay on your credit report?

Often referred to as a reorganization or “wage earner bankruptcy,” Chapter 13 bankruptcy is a process whereby an individual with a steady income but overwhelming debt can pause and reestablish their financial footing while continuing to meet some of their debt obligations. For example, Chapter 13 halts any foreclosure action and allows you to remain in your family home. Chapter 13 allows you to repay a portion of your debt obligation through a court-approved repayment plan. Remaining eligible debt is discharged after you have completed the 3- to 5-year repayment plan. Chapter 13 can be used to do a personal or business (sole proprietorship) reorganization.

Typically, it takes 6 to 12 months to complete a Chapter 13, because it is a more complicated process than Chapter 7. Once completed, you will spend 3 to 5 years carrying out your court-approved repayment plan, after which some of your eligible debts will be discharged. This type of bankruptcy will remain on your credit record for up to 7 years.

How long does Chapter 11 bankruptcy stay on your credit report?

Chapter 11 is the most complex form of bankruptcy. It is a form of “reorganization bankruptcy,” often employed by individuals and corporations that need to get a handle on significant debt so that day-to-day business operations can continue. During Chapter 11 proceedings, the court helps a person or company restructure their debts and obligations while keeping the business’s doors open. Because it is the most complex, Chapter 11 is also the most expensive form of bankruptcy. Therefore, it’s often important to explore other forms of bankruptcy before deciding to pursue Chapter 11. A skilled and affordable Indianapolis bankruptcy lawyer can help you do this. Chapter 11 can be used to do a personal or business reorganization.

Typically, a Chapter 11 bankruptcy will stay on your credit record for up to 10 years.

Contact our skilled bankruptcy lawyer today

If you are overwhelmed by debt and want to learn more about your bankruptcy options, Attorney Jerry E. Smith can help. Our firm is an affordable, compassionate team of bankruptcy specialists who can help you walk through the process with hope and confidence. We’ve helped hundreds of clients get a fresh start and find a brighter future. To find out more, call us for a free one-hour initial consultation at (317) 917-8680. We offer weekend and evening appointments as well as same day filings if possible.

Attorney Jerry E. Smith

Attorney & CPA Jerry E. Smith practices bankruptcy law and tax resolution. Smith’s practice focuses on representing consumer debtors and assisting them in getting a fresh start by reorganizing or eliminating their debt and attempting to put them in the best financial position possible. Mr. Smith has been practicing law since March 1, 2009. Before that, he was and still is a real estate investor. He also previously worked as a Cost Accountant, Financial Analyst, and Internal Auditor for two large multi-billion-dollar international consumer product companies. [ Attorney Bio ]