Salvaging the Credit Rating After Hiring a Bankruptcy Attorney In University Place WA

Ignoring the situation and hiding from creditors is not the solution when someone is mired in unmanageable debt. Those creditors may send the accounts to collection agencies that may have aggressive tactics. Worse, they may hire a law firm to start action that could result in a court judgment against the individual. A Bankruptcy Attorney In University Place WA can help when someone has been unable to deal with the financial trouble.

Ignoring Creditors

This person probably has quit answering the phone when creditors call and may not even open mail from these companies. This can cause the situation to escalate, since those attempting the collections are not going to back down. Once a Bankruptcy Attorney In University Place WA files Chapter 7 paperwork with the court, the creditors are required to cease all contact efforts with the client.

Late Payment Reporting

Without filing for bankruptcy with the help of a lawyer like Rafal Gorski, the person faces continued attempts by creditors to collect. This will continue for many years. A primary reason that credit scores drop so dramatically while all this goes on is because the creditors report late payments every single month, year after year. The person is no longer able to get credit of nearly any type, and may have trouble renting an apartment, getting car insurance or getting hired for a different job.

That credit reporting activity also stops once bankruptcy is filed because the debt is discharged. Without that ongoing negative reporting, the credit score can settle in place.

Raising the Rating After Bankruptcy

The person can start raising the rating by obtaining a credit card that is backed up by funds deposited with the issuing company. Taking out a funded personal loan with the person’s bank or credit union is another way of bring up the credit score.

With the card, items can be charged and the full amount due paid each month. The loan simply is paid each month. It technically is not a loan since the customer originally deposited the full amount with the lending institution, but it functions this way for the credit reporting agencies.

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