I’m worried about a friend that is considering filing bankruptcy. What are the effects that bankruptcy will have on her as she moves forward in life? Does a bankruptcy go on personal records that credit companies will see, or employers? How long will this affect her?

A bankruptcy filing stays on your personal credit report for 10 years. Any time someone pulls her full credit report for approving her for a loan, credit card, or even employment, they will see the bankruptcy filing. Filing for bankruptcy however can actually improve ones credit if it’s been severely impacted by late or non payments. By filing she can start improving her credit much more quickly, so the affect will depend on what she is planning to do in the near future. Any debts she files on that are discharged will be wiped from her credit reports so no one will see those late payments. If she doesn’t intend to buy any large purchases for which she would need a loan for the next 5-7 years and is currently employed and not intending to leave she may not really be affected at all. Bankruptcy gives people a new start, but the biggest thing is learning from the mistakes already made so that they are not made again.