Latest Posts
Home > Ask The Get Out of Debt Experts > Should I Wait to File Bankruptcy Until My Credit Score Reaches a Certain Point? – Jennifer

Should I Wait to File Bankruptcy Until My Credit Score Reaches a Certain Point? – Jennifer

“Dear Steve,

I am considering filing for Chapter 7 bankruptcy. I have $20,000 in credit card debt from a business that I worked for, which went under without repaying any of the money they owed me. I don’t want to file for bankruptcy, but my monthly income is all taken up with basic necessities, and I have one of the companies threatening legal action. I had a great credit score before this happened, so I’m wondering…

Is there a credit score breaking point (ex: 500) under which it’s smarter to file for bankruptcy than try to pay the debt off?

Jennifer”

Don’t miss our free Get Out of Debt – “How To” Guide Series on a number of topics, for loads of practical advice, tips, and help to beat back debt. – Click Here

The Answer

 

Dear Jennifer,

In all my years I think that is the first time I’ve ever been asked that. Awesome question.

The answer is that bankruptcy is triggered situationally and not by a credit score point. Many people with great credit scores go bankrupt and even people who are current on their bills file bankruptcy. Why? Because they see that shortly they are not going to be able to stay current or their situation has changed, for the worse.

The credit score is an artificial number that is calculated not in response to the job you do managing your finances, but the likelihood you will generate maximum profits for creditors with little risk. And as odd as it sounds, a credit score is easy to rebuild after a bankruptcy if you know how.

It sounds to me that it really does not matter what your score is, it does not change the fact that the business went bust and stuck you with debt they were supposed to pay. Your credit score didn’t protect you from that. It just is what it is. So if you ask me what your score should be before you seek help, I’d say whatever it is today.

If you have not done so already, click here to find a local bankruptcy attorney and go in and ask all the questions you can think of about bankruptcy and the process. The better informed you are the easier it will be on you in the long run.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

Should I Wait to File Bankruptcy Until My Credit Score Reaches a Certain Point?   Jennifer
Get Out of Debt Guy – Twitter, G+, Facebook

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

Should I Wait to File Bankruptcy Until My Credit Score Reaches a Certain Point? - Jennifer by

Share This and Spread the Word

About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Jennifer

    Thanks, Steve! Your input helped a lot. I’ve already spoken with a credit counselor and paralegal, so I’ll be filing soon. I’ll let you know what happens.

Get My FREE Get Out of Debt Guy Newsletter

It is the smart thing to do.

I promise to keep your email safe and secure.

Close

I want to keep you posted each weekday with just one email about the latest get out of debt news, scam alerts and information to beat back debt.

You can unsubscribe at any time with just one click.

After you subscribe, check your email to confirm your subscription. If the confirmation email does not appear in your inbox in a few minutes, check your spam folder for it. Sometimes it likes to annoyingly hide there.


  • It will keep you posted on the latest scams.
  • You will be alerted to the latest articles.
  • You will wind up smarter than everyone else dealing with debt.