Aside from the bankruptcy remaining on your credit record for 10 years, your score may drop significantly. Hard to say with specificity since I don't know what it is to start with. Even if the drop is not very far, you will probably experience problems renting property, opening and/or maintaining a bank account, and in some cases a job. If you haven't filed yet, don't do it! Work it out with your creditors in writing and pay the debt off. A bad credit score will come off your credit record in 7 years and will not hurt you as deeply (in my opinion). Companies will generally work with you if they see that you did the responsible thing by working through the difficulty.
If you are surrendering your house anyways, it is usually better for your credit score if you do it through bankruptcy. If your house is foreclosed on before you file bankruptcy, then your credit score is hit by both the foreclosure and the bankruptcy. If you let your house go back through bankruptcy, instead, then your credit score is only hit by a bankruptcy.
As with everything, bankruptcy law can be complicated and the manner by which credit ratings occur can seem mysterious at best. Filing for bankruptcy will in general lower your credit score, but with some good spending habits and good financial stewardship will again rise over time, especially since part of your credit score has to do with income to debt ratio. When you file for bankruptcy, the debts do not simply disappear as if they never existed. Your history of late or missed payments, if you have one, will remain on your credit report and will continue to drag down your credit score. Additionally, the bankruptcy will stay on your record for many years. A Chapter 7 bankruptcy will remain on your credit report for 10 years from the date of the filing
Interesting Question! A credit score of Zero occurs for a variety of reasons-most due to no credit history, but not due to bankruptcy. Zero credit score can occur because you have not had any credit within the past seven years; you have never had any credit; you have had your credit account suspended due to report of identity theft or fraud; or you were convicted of a felony. There may be other reasons for a zero credit score not mentioned here. The normal range of score is around 300 - 850 (depending on your information source). After bankruptcy, a FICO score in the mid to high 400 range, but after a couple years, this tends to come back up to the 500s, even low 600s (depending on how many accounts were included in bankruptcy). Hope this helps!
Late payment will drive your credit score into the ground rapidly. Many people question filing a Bankruptcy even though their credit is shot through late payments on mortgages and other bills. Filing Bankruptcy put all collection activity on hold and your accounts show current and up to date as long as you make your payments on time. Most people are surprised tofine their credit in much better shape after a BK than before with a much higher credit score Late payments can always be corrected, and this will be reflected on your credit file. Bankruptcy, however, will stay on your credit file for six years.
If a consumer does multiple inquiries into their credit file, your score will drop, especially if your inquires are from credit card companies. The theory is: a consumer may not have enough money and needs more credit to sustain his/here lifestyle which bring in more debt, thus applying for more credit.
After your discharge, you can purchase a home at any time. If you pay cash, you may have some serious problems explaining where the money came from and why it was not reported in the bankruptcy documents. If you apply to borrow, you will have trouble qualifying for a mortgage, since credit score will be low, due to the bankruptcy and the poor credit you had prior to filing. You will have to be serious about repairing your credit score, and it will take 3-4 years for you to do that.
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