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Old 03-12-2008, 03:23 PM
 
Location: Atlanta/Decatur/Emory area
1,320 posts, read 3,818,183 times
Reputation: 495

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I have a client who has an old bankruptcy on her credit report. The bankruptcy was discharged in December of 1998 so it is coming up on the 10 year mark in January of 2009.

I have 2 questions that I'd really appreciate answers to from someone with expertise in the area.

1. Is the 10 year mark exact? Will the bankruptcy definitely fall off her credit report in January of 2009? Or might it continue to linger some additional months depending on the credit bureau?

2. She's questioning whether to try to get a mortgage before the bankruptcy falls off. She's got a decent credit score now -- between 720 - 750 depending on the credit bureau, but she ran a FICO simulation on some web site that suggested her credit score would go up about 50 points without the old bankruptcy on there, so she's thinking it might make sense to wait until January before she applies.

Any experts out there who can provide insight?

Thanks in advance for your time!
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Old 03-12-2008, 03:40 PM
 
4,797 posts, read 11,977,283 times
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No need to wait. 720-750 will get her the best financing options available.

It should fall off right at the 10 yr. mark.
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Old 03-12-2008, 03:44 PM
 
Location: central, between Pepe's Tacos and Roberto's
2,086 posts, read 6,213,827 times
Reputation: 958
Pretty much all conforming loan programs are ok 4 years from discharge of a chapter 7, and 3 years from discharge of a chapter 13. Give her the greenlight to get pre-qualified. I can't say if her FICO would improve by that much, I can say that the difference between 740 and 780 in terms of rate would likely be negligible.
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Old 03-12-2008, 03:47 PM
 
3,646 posts, read 9,631,314 times
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Some banks require only 2 years after the discharge of bankruptcy, depending on your reason for filing, whether or not you reaffirmed any of the debt after discharge and how you've handled credit since filing. As long as her score is that high, she should be fine.
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Old 03-12-2008, 04:16 PM
 
Location: Atlanta/Decatur/Emory area
1,320 posts, read 3,818,183 times
Reputation: 495
Thanks for the info! Fingers crossed she decides to take the plunge sooner rather than later!
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Old 03-15-2008, 12:27 PM
 
Location: Woodbridge Twp NJ
316 posts, read 1,137,545 times
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Quote:
Originally Posted by sskkc View Post
Some banks require only 2 years after the discharge of bankruptcy, depending on your reason for filing, whether or not you reaffirmed any of the debt after discharge and how you've handled credit since filing. As long as her score is that high, she should be fine.
If you have restablized your credit with new tradeline then you should have no problem. Most lenders don't count a bankruptcy after 4 years.
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Old 03-15-2008, 12:34 PM
 
Location: Woodbridge Twp NJ
316 posts, read 1,137,545 times
Reputation: 60
Quote:
Originally Posted by sskkc View Post
Some banks require only 2 years after the discharge of bankruptcy, depending on your reason for filing, whether or not you reaffirmed any of the debt after discharge and how you've handled credit since filing. As long as her score is that high, she should be fine.
You have new credit since the Bankruptcy then no worries. most banks care because it is so far out of discharge.
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