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26.02.2018

Bankruptcy, the Insolvency Register and Credit Report

Bankruptcy, the Insolvency Register and Credit Report

A key aspect of going through bankruptcy that people want to know is how it affects your credit score. Most people who are have problem debt are aware that their credit scores are low because they have regularly had to miss payments on their loans, and that this can negatively affect their ability to take out credit.

The Insolvency Register

The first important aspect to consider is that your bankruptcy will be placed on the Insolvency Register. This means some of your personal details are put on the register, which is free to access by everyone. This includes:

  • Your name
  • Address
  • Occupation
  • Date of the bankruptcy order
  • The details of your Official Receiver

While this information is available online for anyone to find, it is not linked to any search engines. It is sometimes possible to request for your address to be removed from the register in cases where identification may be dangerous for the individual.

As this information is easily searched, credit report agencies often use it and add your bankruptcy to your credit report. This is how bankruptcy can lower your credit score as credit scores are intended to score how financially responsible and stable you are, and, unfortunately, a bankruptcy can make you appear to be financially unstable, even if you are now gaining control of your finances.

Your Credit Report

Your bankruptcy is listed on the Insolvency Register for six years. This means that it affects your credit report, and lowers your credit score, for six years. However, bankruptcy itself lasts 12 months and after this time the debts included in your bankruptcy are officially written off. At this point they should have zero balances on your credit report, and this is the first step in improving your credit score.

Your credit report won’t improve overnight. It takes time to prove to credit agencies that you have successfully achieved financial stability. This makes it necessary to work at your credit report to make yourself appear as financially responsible and stable as possible. This might involve responsible use of a credit card, where you pay off your balance before interest is added, but other methods such as joining the electoral roll can also improve your credit score.