How Many Points Does Bankruptcy Lower Your Credit Score?

Filing for bankruptcy usually lowers your credit score by 130 to 240 points, and the exact size of the drop depends almost entirely on where your score stood before you filed. People with excellent credit lose the most points; people whose scores were already damaged by missed payments and collections lose the least. That’s the short answer to how many points bankruptcy lowers your credit score, and the rest comes down to your starting number, which chapter you file, and how the discharged debts get reported afterward.¹

How Much Your Score Drops Based on Where It Started

Credit scoring models treat bankruptcy as one of the most serious negative events on a credit report. It outweighs individual missed payments or collections because it signals a broad inability to repay debts across multiple accounts. The point drop reflects that severity, but it also reflects how far your prior behavior sat from the risk profile of someone filing for bankruptcy.

Here is the general breakdown by starting range:

Excellent (800–850): A drop of roughly 200 to 240 points is typical. The gap between a near-perfect payment history and a bankruptcy filing is so wide that the scoring model treats the shift as an extreme deviation.
Very good to good (670–799): Expect a drop of about 150 to 200 points. Someone starting at 680 might land in the low 500s after filing.
Fair (580–669): A drop of roughly 130 to 150 points is common. Your score has already absorbed damage from late payments or high balances, so the additional penalty is smaller.
Poor (300–579): The theoretical drop is still 130 to 150 points, but because scores cannot go below 300, the visible decline is smaller. Many of the negative factors bankruptcy reflects are already dragging the score down.

The pattern exists because scoring models measure how far your behavior deviates from what your credit history would predict. A person who has never missed a payment looks far riskier after a bankruptcy than a person with a trail of defaults. Someone with a 780 and someone with a 540 may both end up in the 500s after filing, but the 780 filer loses far more points getting there.²

Does Chapter 7 or Chapter 13 Cause a Bigger Drop?

Federal bankruptcy law offers two main paths for individuals. Chapter 7 is a liquidation process: a court-appointed trustee collects and sells eligible assets, and qualifying debts are discharged.³ Chapter 13 works differently. You propose a repayment plan lasting three to five years, and during that time you pay back some or all of what you owe.⁴

Despite the very different structures, credit scoring models treat the initial filing of either chapter with roughly equal weight. The immediate point drop is triggered by the existence of a bankruptcy on your credit report, not by which chapter you chose. Choosing one over the other will not meaningfully soften the initial hit.

The chapters diverge later, in how long the filing stays on your report, which shapes your recovery timeline more than the initial drop.

How Long the Damage Stays on Your Report

Federal law caps how long a bankruptcy filing can appear on your credit report. Under the Fair Credit Reporting Act, credit bureaus cannot report a bankruptcy case that is more than 10 years old, measured from the date the court entered the order for relief.⁵

In practice, the three major credit bureaus draw a distinction:

Chapter 7: Stays on your credit report for 10 years from the filing date, the full period the law allows.
Chapter 13: The credit bureaus voluntarily remove it after 7 years from the filing date, even though the statute would allow 10.

The clock starts when you filed the petition, not when the bankruptcy was discharged or completed. That reporting period is already running while a Chapter 13 repayment plan is underway, so a Chapter 13 filer who completes a five-year plan has only about two years of reporting left after discharge. The shorter window is one practical advantage of Chapter 13: the initial score drop is similar, but the report clears three years sooner.

Why Your Score May Stay Lower Than It Should

Once your bankruptcy is discharged, every debt included in the case should be updated to show a zero balance and a status such as “discharged” or “included in bankruptcy.” A discharged debt should never appear as currently owed, past due, delinquent, or carrying an outstanding balance.⁶

Reporting errors on discharged debts are one of the most common reasons scores stay depressed after a filing. If a creditor fails to update its records, the old debt keeps dragging your score down as though you still owe it. Watch for these specific red flags when you review your reports after discharge:

Active or open status: A debt included in the bankruptcy still showing as an active account with a balance due.
Continued delinquency reporting: Monthly updates that keep marking the account 30, 60, or 90 days late after it has already been discharged.
Re-aged accounts: Discharged debts reappearing under a new account number or a different creditor name because the debt was sold to a third party, without any notation that it was discharged.

You have the right to dispute any of these inaccuracies directly with the credit bureau, which is required by law to investigate. Cleaning up the errors can produce a noticeable score improvement fairly quickly, because you are removing negative items that should not be counted against you at all.

How Quickly the Score Can Recover

Most people who actively work at rebuilding see improvement within 12 to 18 months of filing. Getting back into the fair range of 580 to 669 within that window is realistic if you take deliberate steps.

The most common rebuilding tool is a secured credit card. These cards require a refundable cash deposit, often around $200, that serves as your credit limit. Because the deposit eliminates the lender’s risk, secured cards are accessible even with a recent bankruptcy on your record. Using the card for small purchases and paying the balance in full each month builds a track record of on-time payments, which is the single most important factor in your score.¹

Other steps that help:

Credit-builder loans: Some banks and credit unions offer small installment loans designed to establish a payment history. The loan proceeds are held in a savings account until you finish making payments.
Authorized user status: Being added to a family member’s well-managed credit card can add positive payment history to your report.
Monitoring your reports: Check your reports from all three bureaus regularly after discharge and dispute any discharged debts that still show a balance or delinquent status.

The bankruptcy itself fades in impact over time, even before it falls off your report. Scoring models give more weight to recent activity, so two or three years of responsible credit use can push your score well into the mid-600s even while the bankruptcy is still visible. On-time payment history accounts for roughly 35% of a FICO score and is the fastest lever you can pull after a filing.¹

1
FICO Score. FAQs About FICO Scores in the US
2
myFICO. Bankruptcy Types and Their Impact on FICO Scores
3
Office of the Law Revision Counsel. 11 U.S. Code 727 – Discharge
4
Office of the Law Revision Counsel. 11 U.S. Code 1322 – Contents of Plan
5
Office of the Law Revision Counsel. 15 U.S. Code 1681c – Requirements Relating to Information Contained in Consumer Reports
6
Consumer Financial Protection Bureau. A Summary of Your Rights Under the Fair Credit Reporting Act