Chapter 7 and Chapter 13 Bankruptcies and Their Effect on a FICO Score
The formula used for FICO scoring treats both Chapter 7 and Chapter 13 bankruptcies similarly. It considers these two forms of bankruptcy as having the same level of severity, myFICO says.
Both types are considered in this manner due to research conducted by Fair Isaac Corporation (FICO), which found these are similarly predictive in assessing future creditworthiness.
As with other negative credit information, the effect of a bankruptcy on a FICO score will diminish over time, according to my FICO.
Named one of the most widely used credit scores, FICO Scores can influence credit and loan approvals and what terms and interest rates a customer may qualify for.
For more credit repair tips, visit www.scoreceo.com/blog.
Category: Blogs
Comments are closed.
