One of the biggest concerns people have when making the ultimate decision to file bankruptcy is how the process of filing bankruptcy affects your credit score. First we must determine what is a credit score and how your credit score is calculated.

A credit score is a number that is configured by many different factors on your credit report. There are three different credit repositories that report your credit. These are Experian, Equifax and Trans Union. Each of these repositories have a scoring model they use so a potential creditor, rather than review your entire credit report, they can simply look at your score and determine if you are credit worthy.

Each repository has different names for their scores. Experian will call it a FICO score and Equifax sometimes refers to it as a Beacon score. The score is computed by many different factors such as how many late payments you have, are you overextended on your credit, do you have any judgments or liens, have you ever had a foreclosure and of course do you have a file for bankruptcy.

The higher your score the more credit worthy you are considered by creditors. The range in which your score can fall is a confusing issue because of the various different scoring models. As a general statement most scores fall within the range of somewhere in the 400s to somewhere in the 800s.

So how would a file for bankruptcy affect such a score? The reality is filing for bankruptcy is actually quite devastating for your score. However the good news is once your bankruptcy has been discharged and some time has passed your score will start to rise again.

As a bankruptcy attorney will tell you, the decision to file bankruptcy is one that needs to be made based on whether you are completely drowning in debt and you are unable to pay your bills. Whether it be a chapter 7 bankruptcy or a chapter 13 bankruptcy that will be able to provide you with the relief that you need, your credit score should be the last factor you should consider in your decision in filing bankruptcy.

Always remember that although a file for bankruptcy will greatly affect your credit score, with time your credit score will slowly increase and creditors will reach out to you once again with offers of credit.

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