Fair Credit Reporting Act (FCRA) Dismissed Bankruptcies

Last Updated: Nov 20, 2022

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Sometimes, it is easier to rebuild your credit score after filing for bankruptcy, rather than having delinquent accounts weighing it down every month. You do not want to be thrown into an endless cycle of debt.

Perhaps you feel as if you are stuck between a rock and a hard place, trying to decide whether to file for bankruptcy. Here is a short, but detailed article which will help you to understand what impact a bankruptcy will have on your credit, and for how long it will remain on your report.

What Reporting Rules Does The FCRA Prescribe?

Credit Reporting Act is the law that requires consumer reporting agencies (also called credit bureaus) to maintain an accurate file of your credit information. Creditors who report your information to the consumer reporting agencies (CRAs) must also be truthful.

When running a background report, the Fair Credit Reporting Act is the federal law that regulates how long a CRA can report information. Consumer reports typically include the following information from bankruptcy filings:

  • The federal bankruptcy court documents
  • Information about which debts were discharged or included in the bankruptcy filing.

It’s important you understand the rules and regulations of the FCRA and not the rules laid out by a bureau as the FCRA is the final authority when it comes to Trade and Commerce.

Do Dismissed Or Discharged Bankruptcies Show Up On Credit Reports?

Yes, they do. However, the time period depends on the kind of bankruptcy. A Chapter 7 bankruptcy can stay on your credit report for up to 10 years from the date the bankruptcy was filed, while a Chapter 13 bankruptcy will fall off your report seven years after the filing date. After the allotted seven or 10 years, the bankruptcy will automatically fall off your credit report.

How Long Is Bankruptcy Reportable On A Consumer Report?

Each type of bankruptcy is reportable for a different period of time from the date of filing:

  • Reportable for 10 years: Chapter 7, 11, and 12 bankruptcies.
  • Reportable for 7 years: Chapter 13 bankruptcies.

A bankruptcy public record will have an impact on your credit scores as long as it appears on your credit report, even after it has been discharged.

Bottom Line

Filing for bankruptcy has serious financial consequences, but is unavoidable in some cases.

Chapter 7 bankruptcy can give a person a fresh start by freeing them of debt, but a credit report will reflect the bankruptcy for 10 years and will affect a person’s future credit score.

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