At Consumer Justice Law Firm, we help you recover from the harmful consequences of bankruptcy reporting by upholding and protecting your rights under federal and state law. This includes enforcing your rights under the Fair Credit Reporting Act and doing everything the law allows to hold companies accountable for the reckless way they handle your data.
Bankruptcy reporting errors are a type of credit report error that is incredibly harmful. Justice for bankruptcy reporting errors looks like this: Making credit bureaus, other consumer reporting agencies, and data providers (1) fix their mistakes, (2) pay you compensation for the harm they caused, and (3) pay for your legal bills because you had to force them to do the right thing.
What Bankruptcy Reporting Errors Are
Bankruptcy reporting errors are credit errors that show up on consumer reports (like credit reports) after someone has filed for, and been approved for, bankruptcy. Bankruptcy gives you a plan of action for eventually getting back on solid financial footing. Of course, it’s not without a cost, including a ten year reporting period for bankruptcy on your credit report. But, most people can expect to see improvements in their credit scores long before the reporting decade comes to close.
However, bankruptcy reporting errors can make it impossible to get ahead. These errors include the continued reporting of delinquencies, showing discharged accounts as charge-offs, incorrectly reporting hefty balances on accounts that should have a zero-dollar balance, and otherwise failing to accurately reflect your debt-to-income ratio after bankruptcy.
In addition, if you’ve survived the ten-year reporting period, then there should not be any evidence of your bankruptcy lingering on your credit report.
What Causes Bankruptcy Reporting Errors
Bankruptcy reporting errors are usually caused by a combination of two things: (1) Clerical failures at financial and lending companies that hold your accounts. Once an Order of Discharge is entered, you should expect that the companies holding your debts will respond accordingly and update the information in their internal systems. This should mean things like zeroing out balances owed, marking charge-offs as discharged, etc. Failing to update your data means that debts continue to be reported as though the bankruptcy never happened. In addition, once you’re out of the ten-year reporting window, evidence of bankruptcy should not show up in your credit report. (2) Bad review protocols at consumer reporting agencies. When algorithms are in charge of compiling and reviewing data, reporting discrepancies and errors go unchecked and investigations are inadequate.
How Bankruptcy Reporting Errors Harm You
Whether you have accounts being misreported under the terms of your bankruptcy, or a bankruptcy being reported that should have aged-off your report after ten years, these reporting errors can harm you in any of the following ways and more:
- Credit Score Stagnation or continued drop. Instead of a steady state or a slowly improving score with time, you can end up stuck or headed in reverse.
- Mortgage denials. You may be ready to move on and may have saved up for a downpayment on a place of your own, but you can still be unfairly denied.
- Rental denials. Whether you’re looking for a long-term rental for housing, a vacation rental for fun, or a car rental for commuting, you can be falsely flagged as a rental risk.
- Car loan rejections. Even if you’ve saved for months, selected within your budget, and paid every single bill, loan, and debt on time since filing for bankruptcy, you can be unfairly turned down.
- Job loss. Whether you’re a new candidate or a current employee, if a healthy credit report is part of your assessment, you can be let go or passed up due to bad data.
- Credit denials. Home equity loans, personal loans, and lines of credit through a bank or lender can be denied, despite the promise of a fresh start.
- Store account refusals. If you apply for a store card or account with a favorite retail brand, you can be refused rather than rewarded.
- Insurance denials. When you seek insurance or other financial products, a solid credit rating is usually critical, and you can be denied for falsely failing to meet the standard.
- Worse loan terms. Even if you’re approved for a loan, inaccurate or misleading data can mean that you get stuck with worse interest rates and bad loan terms.
- Mental and emotional distress. From missing out on long-awaited opportunities to losing sleep due to worry or being plagued by anxiety, the toll these errors take is real.
Steps To Take After Discovering Bankruptcy Reporting Errors
Step 1 Talk to a lawyer
The law upholds your right to accurate consumer data and obligates companies to investigate and fix their mistakes, but the system itself is broken. Investigations are frequently inadequate, and stalls, delays, and unfixed errors are common. A lawyer will clearly set out your rights, guide you through the dispute and recovery process, and get you compensation.
Step 2 Dispute the errors
You have a right to receive a copy of your credit report when a credit check is run or to access your reports weekly from each of the credit bureaus. Carefully review your credit reports and financial statements and dispute any inaccurate, misleading, false, or unreportable data. If you’re working with us, we’ll handle this process for you. If you’re not, file your disputes via certified mail to preserve all of your legal rights.
Step 3 Make them fix it
If you know the data in your credit report is wrong, never accept their nonsense when they say they’ve investigated and confirmed that it’s right. This is a common outcome of shoddy internal investigations and does not meet their legal obligations to do the right thing. But a lawsuit usually gets the job done.
How A Bankruptcy Reporting Error Attorney Leads You to a Full Recovery
Legal Guidance
Correcting bankruptcy reporting errors shouldn’t have to be a complicated and convoluted process, but it frequently is. Working with an experienced attorney gives you the best shot at a full resolution and maximum compensation.
Here’s how we help you:
- We know the law. We know the laws that protect you and how to go after these careless mega-corporations using every possible legal option available.
- We know the problems. We’ve seen, heard, and handled every type of credit report error, including bankruptcy reporting errors, and put our full knowledge and resources into everything we do.
- We know the tricks. We know the tactics used by these companies to delay doing anything to fix reporting mistakes. They’d rather convince you it’s a lost cause. We know otherwise.
- We provide legal guidance. We help you gather necessary data and evidence, craft and file legally sound disputes, and advise you of your rights and best practices along the way.
- We file a lawsuit. If your errors aren’t corrected or the fallout persists, we file a lawsuit to hold companies accountable.
- We get you money. If you’ve been harmed by credit report errors and you’re entitled to compensation, we know how to maximize it.
Don’t underestimate the peace of mind that comes from knowing every next move is the right move toward recovery.
The Role of the Fair Credit Reporting Act
Consumer data errors are the consequence of a fast and furious economy that depends largely on the ability of monstrously large corporations to gather, process, and report data for tens of millions of individuals on a rolling basis. In the balance between speed and profit, accuracy is the first thing to go. And you pay the consequences. Because bankruptcy reporting errors are part of a persistent, systemic problem, and because they cause genuine harm to consumers every single day, the federal government passed an important piece of legislation- the Fair Credit Reporting Act (FCRA) to try to protect you.
We rely heavily on the FCRA to build the best possible cases and get the best possible outcomes. The FCRA gives you critical consumer reporting rights, including the right to:
- review your credit reports for free
- know which data in a credit report was used to deny you an opportunity
- dispute credit report errors
- file lawsuits against the responsible parties
- seek compensation for harm suffered
- make the wrongdoers pay for your legal costs and fees
- also, when it comes to bankruptcy, the FCRA gives you the right to a clean slate after ten years from the date the bankruptcy is filed or discharged
How to Dispute Bankruptcy Reporting Errors
- Review your credit reports for incorrectly reported accounts, debts, and statuses.
- Gather any evidence and documentation you have to support your dispute, including your Order of Discharge.
- Write a thorough and clear letter explaining exactly which information in your credit report is wrong and why.
- Mail your letter, along with copies of the supporting documents, via certified mail to the credit bureau reporting the errors. This preserves your rights and leaves an easily traceable trail. Avoid using online dispute platforms.
- Keep a copy of the letter and documents for your file, along with the mail receipt.
- Track the days. They have 30 days to respond.
- Don’t give up. If they don’t respond, don’t investigate, don’t fix the errors, or claim that their investigation confirmed the bad data, you need a lawyer NOW.
How Fee-Shifting Makes the Wrongdoer Pay Your Legal Bills
One of the most important and least known facts about embarking on the credit error recovery journey is that you don’t have to pay out of pocket for legal help. Under the FCRA, you are not expected to spend your own money or take on debt just to dispute credit errors and demand corrections of your data since you didn’t create the problem in the first place. The ones who made the problem have to pay to fix it.
At Consumer Justice, we respect this fee-shifting provision for the role it plays in our legal system, especially since it serves as an equalizer, bringing justice to everyone, including those who otherwise couldn’t afford to work with an attorney. We value each and every client and every case, and appreciate that the law has carved out a way to center equity and fairness in legal representation for consumers harmed by big business data errors.
Frequently Asked Questions
Can creditors continue to report your bankruptcy after ten years?
No. The Fair Credit Reporting Act is clear that ten years is the maximum length of time you should expect to see your bankruptcy included on any consumer report in your name. This is true for your records at individual retail, financial, or credit companies and for your credit reports with any of the credit bureaus (Experian, Equifax, and TransUnion). This ten-year period is called the reporting period and your bankruptcy is said to have “aged-off” of your reports at the end of this time. If your credit report continues to report your bankruptcy after it has aged-off, the you have a right to dispute this error and have it corrected.
Who is responsible for updating my credit report when I file for bankruptcy?
The individual financial and credit companies who hold your debts at the time of bankruptcy are responsible for updating their records according to the Order of Discharge and in accordance with the requirements under the Fair Credit Reporting Act. However, because our consumer economy, including the tracking and purchasing of consumer data, is so massive, there is a frequent problem with misreporting accounts in bankruptcy and unfairly reporting aged-off bankruptcies. For this reason, while the legal answer is that companies are responsible for following the law and reporting accurate information, the real answer is that you should stay on top of every detail of your credit report, dispute any unfair or illegal reporting, and work with an attorney if you’re not getting anywhere.