Recent developments: Bankruptcy debt credit reporting

Since 2008, most of the stories published in both local and national media about credit, debt and bankruptcy have been quite disheartening. Banks have engaged in abuses of power that boggle the mind. Families have had their financial realities turned upside down. But as the economy has continued to recover and Americans have become increasingly literate financially, progress is being made on several debt and credit-related fronts.

For example, when individuals opt to file for personal bankruptcy, their credit scores are meant to quickly reflect repayment, debt discharge and forgiveness. These bankruptcy-related changes to one's credit score are key to beginning the credit repair process. However, consumers have too often been saddled with credit reports that do not accurately reflect account activity post-bankruptcy. Thankfully, this trend is finally beginning to change for the better.

A class-action lawsuit filed before the economic crash and settled in part in 2008 compelled the major credit bureaus to take significant steps toward righting this widespread wrong. When errors or omissions now appear on consumer credit reports, the bureaus must now investigate them once they are brought to their attention. In addition, debts affected by bankruptcy must now be accurately modified on credit reports.

Consumers are not always treated fairly by creditors. However, recent progress made with respect to credit reporting post-bankruptcy has given the public a genuine reason to believe that debt-related challenges are becoming easier to navigate in just ways. If you have concerns related to your credit report post-bankruptcy, the law is on your side. Please speak to an experienced attorney about your options.

Source: New York Times, "Credit Reports More Accurately Reflect Debts Discharged in Bankruptcy," Ann Carrns, Apr. 30, 2013