Approximately 80% of all credit reports contain errors. People who have filed for bankruptcy, on the other hand, are at an even higher risk of having inaccuracies and mistakes on their credit reports. If you’re looking for a quick summary, here it is:

  1. The full amount of a monthly payment or account balance that was reduced down in the bankruptcy is still recorded.
    This happens frequently, particularly with second mortgages. If your client has ever filed for bankruptcy, you must obtain a copy of the bankruptcy plan in order to determine whether any monthly payments or liabilities were reduced. If that’s the case, double-check that they’re reporting appropriately on credit reports.

  2. Only one of a husband and wife’s bankruptcy filings has been reported, but both have been reported as having filed for bankruptcy.
    If your client has ever filed for bankruptcy, have him or her pull his or her spouse’s credit record to ensure that the spouse is not listed as having filed for bankruptcy.

  3. An open balance is an item that has been dismissed in bankruptcy but is still reported. As you may be aware, an unpaid amount can have an impact on your credit score. It’s critical to double-check that all dismissed debts are listed as “discharged in bankruptcy.”

  4. Payments made after bankruptcy are not being applied to the account.
    This is a bit of a challenge. Creditors claim that there is no debt following bankruptcy. Despite this, many consumers will continue to make payments on their previous mortgage debt, which will be accepted by the lenders. This, in my judgment, constitutes both parties’ approval of the discharged mortgage debt. As a result, the mortgage debt should decrease as payments are made. Consider this: once the consumer makes the last payment on the debt, will the bank keep the property or will the lien be lifted? If the latter, the parties have either reached an agreement on a new arrangement or have agreed to continue with the previous one.

  5. After a bankruptcy has been filed, late payments are disclosed.
    Many of a consumer’s liabilities are adjusted and lessened after filing for Chapter 13 bankruptcy. A car payment, for example, may be reduced from $500 to $300 per month. Accepting the $300 per month payment and reporting the consumer late for not making the $500 payment gets creditors in trouble.

  6. After a bankruptcy is filed, the lender erases the balance and payment history. – After a consumer files for bankruptcy, creditors may withdraw the outstanding balance from their trade line. While this may appear to be a beneficial thing, the negative is that there is no balance that decreases over time when the consumer makes post-bankruptcy payments against this debt. As a result, future credit grantors may not notice that the consumer has been making timely payments.

If you are having trouble with any of these areas and need help, we can help. Please send an email to

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