As part of our bankruptcy services, after either a Chapter 7 or Chapter 13 case is discharged and completed, we help our clients get their credit cleaned up, at no additional charge. I don't know how many bankruptcy lawyers do that. We started doing it about 5 years ago, because we would get calls from clients telling us that discharged debts were still showing up on their credit reports.

What happens sometimes, when someone files a bankruptcy, the individual "tradelines" or creditors, just stop reporting to the credit bureaus. So it still looks like you owe money. In the old days, I would send clients a letter with their bankruptcy discharge, and tell them how to do it themselves.

But, very few if any of them did it. I guess after a bankruptcy people are just not focused on cleaning up their credit. But they sure are focused on their credit reports a year or two or three later, when they are sitting in a title company trying to close on a house, or in a vehicle dealership finance manager's office trying to buy that new car or truck. If your credit is still showing that you owe delinquent debts, it looks like you charged up debt after the bankruptcy and didn't pay it.

I would get calls from people telling me that I didn't bankrupt their debt right! So, now as a matter of routine, we prepare the credit reinvestigation letters for the clients to sign, and we see that they are mailed to the credit bureaus, after a bankruptcy is over. The clients receive updated credit reports in the mail within 30 days or so, and almost without fail, the tradelines show a zero balance due, and that the accounts were included in bankruptcy, as they should.

Of course we tell the credit bureaus which debts were reaffirmed, if any were, so that those accounts continue to report. I'm told that our "credit clean up service" increases a former debtor's credit score by 25-150 points. But don't get delinquent on NEW debts after a bankruptcy; that will sink your credit score faster than anything.

You must maintain good payment habits after a bankruptcy, or you'll never recover your good credit. For a very good explanation credit and how it works, go the FTC website and read an article entitled Building a Better Credit Report. We have them available in my law office in Houston and we can hardly keep them in stock.

J Thomas Black
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Board Certified, Consumer Bankruptcy Law- Texas Board of Legal Specialization
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