How Long Does a Bankruptcy Stay on Your Credit Report?

Written By
G. Dautovic
July 04,2023

For anyone facing financial hardship, filing for bankruptcy can sometimes be the only remaining solution. Regardless of the circumstances forcing you to consider bankruptcy, it’s a serious decision bound to have a severe impact on your creditworthiness.

That said, bankruptcy isn’t the end of the world. It’s a last-ditch attempt to save remaining finances and requires one to stay practical and keep their wits about them. So the first practical question you should ask yourself is: How long does a bankruptcy stay on your credit report? The short answer is: It depends on the type of bankruptcy.

Common reasons for declaring bankruptcy include job loss, medical debts, or divorce. Living beyond one’s means may seem like the main reason for bankruptcy, but the unforeseen events we’ve just mentioned are, in fact, more common. Anyone can find themselves in a situation like this.

Knowing more about various types of bankruptcy can help you make the right decision, so we’ll tackle this subject in more detail in the next section.

Types of Bankruptcy: Chapter 7 vs. Chapter 13

Bankruptcy is not a life sentence. You can remedy personal financial misfortune and manage its impact on your credit score with sound financial planning. However, you can expect the bankruptcy to leave a mark on your credit score from seven to ten years, depending on the type of bankruptcy you filed for.

The main difference between Chapter 7 and Chapter 13 lies in your ability to deal with debt. For debtors in the worst financial situation who cannot pay off any of their obligations, the best course of action is filing for Chapter 7 bankruptcy.

What Is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is also referred to as a liquidation or straight bankruptcy. It’s used as a last resort and may have long-lasting repercussions on your credit score and finances.

When you file for Chapter 7, the court pauses payments on any current financial obligations you have. Your property ends up under the court’s jurisdiction, and a bankruptcy trustee is assigned to the case.

The trustee will oversee your case and review your finances to determine nonexempt property. This is the property the bankruptcy won’t allow you to keep. It will instead be sold to repay your debts.

The property you will be allowed to keep is called exempt property. The list of that property varies by state. In certain states, after filing Chapter 7, you will be able to choose between federal and state exemptions. Most of the time, personal property is exempt.

Four to six months after the bankruptcy filing, the court will discharge your remaining debts. However, some debts are not dischargeable. These include various taxes, government or court penalties, fees and fines, alimony, child support, student loans, personal injury fees, attorney’s fees in custody trials, and criminal restitution. It means that you are only relieved of any outstanding consumer and unsecured debts.

How Long Does Chapter 7 Stay on a Credit Report?

Your credit report will keep a record of your Chapter 7 bankruptcy for 10 years after the filing date. Any individual delinquent accounts on your credit report that were included in the bankruptcy will be removed seven years after they first became late.

What Is Chapter 13 Bankruptcy?

Unlike Chapter 7, Chapter 13 represents a reorganization of your finances. The debtor still has an obligation toward their creditors and fulfills it through the trustee. They are responsible for making monthly payments to the trustee, who will distribute the funds to creditors with proper claims.

How Long Does Chapter 13 Stay on a Credit Report?

When you file for Chapter 13 bankruptcy, you get to keep your property, but you are still expected to adhere to a repayment plan approved by the court and partially repay your debts. After three to five years, when you finish your plan, the rest of your debts will be discharged. This is why Chapter 13 bankruptcy stays on your credit report for seven – not 10 – years. It is removed after that period if at least a part of the debt was repaid.

Is It Better To File a Chapter 7 or 13?

It depends on your financial situation and, most notably, on your secured debts. By filing for Chapter 13 and keeping up regular payments, you may prevent foreclosure on your property. This may be a better solution for debtors who have enough income to consolidate debts within a three to five-year period. By doing so, you will protect any nonexempt property that would be seized if you filed for Chapter 7.

Note that, unlike Chapter 7, Chapter 13 is only available for individuals and sole proprietors.

Bankruptcy Credit Score Impact

The impact on your FICO score will mostly depend on your credit score before bankruptcy. According to FICO damage points guidelines, if you had a credit score of 780, you’d lose between 220 and 240 points. The impact would be lesser for someone with a credit score of 680. They would lose between 130 and 150 points. It means that any type of bankruptcy would lower a good credit score to a poor one and a very good score to an average one.

As we can see, the impact of bankruptcy on credit reports and subsequently on credit scores is quite severe. The only significant difference is how drastic the drop is for higher credit scores.

Rebuilding Your Credit Score

To be eligible for better loans and credit cards after bankruptcy, you’ll need to repair your credit score. There are plenty of credit restoration specialists that can assist you with this, or you can do it on your own. Don’t let the limited options dissuade you from researching and finding what you can do to improve your credit score after bankruptcy.

There are a few steps you can take to get better at managing your finances and start rebuilding your score:

  • Pay your bills on time. Even keeping up with your utilities can help you, especially with services like Experian Boost.
  • Plan your budget responsibly and start saving.
  • Consider opening a secured credit card account. Your initial deposit covers secured cards. By paying your balance on time, you can improve your credit score since most companies that issue secured credit cards report to the three credit bureaus.

As you can see, there are ways of dealing with bankruptcy on a credit report and improving your credit score.


Can Chapter 7 be removed from credit before ten years?


While Chapter 7 bankruptcy is automatically removed from your report after ten years, it can only be removed earlier if added by mistake to your credit report. So a prudent course of action would be to regularly check your credit report for any errors and dispute it if bankruptcy shows up by mistake.

Does a bankruptcy automatically come off?


Any bankruptcy will automatically be removed from your credit report after seven to ten years, depending on the Chapter filed. There is no need to contact credit bureaus to get Chapter 13 or Chapter 7 bankruptcy discharged manually.

Can you remove a bankruptcy from your credit report?


Legitimate bankruptcies cannot be removed from a credit report. After their expiration period, which is seven or ten years, they will be automatically removed.

How much will my credit score increase after the bankruptcy falls off?


According to reports, a credit score can improve by 50 to 150 points for some people after the bankruptcy is removed from their credit history. Bankruptcy is the most impactful negative influence on a credit score and can lower it anywhere between 240 and 130 points, depending on how high the score was before bankruptcy.

How long does a bankruptcy stay on your credit report?


If you file for Chapter 7 bankruptcy, it will remain on your credit report for 10 years. Chapter 13 bankruptcy stays on your report for seven years but requires paying off at least a part of your debt.

About author

I have always thought of myself as a writer, but I began my career as a data operator with a large fintech firm. This position proved invaluable for learning how banks and other financial institutions operate. Daily correspondence with banking experts gave me insight into the systems and policies that power the economy. When I got the chance to translate my experience into words, I gladly joined the smart, enthusiastic Fortunly team.

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