Filing for bankruptcy is not an easy decision. Those living in Maryland often spend months or even longer struggling to keep up with their monthly payments, some of which may just keep ballooning because of interest rates. With only so much money, high interest rates and a backlog of unpaid bills, filing for Chapter 13 bankruptcy will probably start to feel like the right decision. Some people still have reservations though, especially when it comes to their credit cards.

Consumers put a lot of time and effort into improving and maintaining their credit scores. But credit scores are not invincible, and filing for bankruptcy can have a negative impact. A Chapter 13 filing stays on a person’s credit report for a period of seven years, which has less of an overall impact than the 10 years that a Chapter 7 stays around for. How many points a person’s credit score drops will depend on his or her score before filing for bankruptcy, so some may lose 240 points while others only lose 130.

A bankruptcy on someone’s credit report plus a lower credit score can certainly impact a person’s access to certain financial services. Creditors may not want to lend to someone who has struggled with nonpayment. But since Chapter 13 bankruptcy is a repayment plan that lasts anywhere from three to five years, people usually will not access new lines of credit during that time.

There is one thing that people tend to overlook when considering how bankruptcy may affect their credit scores — missed payments do as well. By the time someone has reached the point of filing for Chapter 13 bankruptcy his or her credit score might have already taken a significant hit. These are the kinds of factors that Maryland consumers should consider when weighing the benefits of pursuing bankruptcy.