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Many Oklahoma residents choose to file bankruptcy as a solution to their debt problems. Equifax, a major credit reporting company, has traditionally treated Chapter 13 bankruptcy filers differently than the other two major credit reporting companies by displaying the bankruptcy on a consumer’s report for three more years than the other companies. Recently, the company has elected to make changes to that policy.

The other two major credit reporting companies, TransUnion and Experian, placed flags on consumer reports for seven years after a Chapter 13 bankruptcy was filed while Equifax placed flags on reports for the same consumers for 10 years. The company has now changed the policy but has not offered an explanation as to why the change was made.

From 2008 to 2010, 574,000 Chapter 13 bankruptcy cases were dismissed, usually because debtors fell behind on their payments. Even if a case was dismissed, credit reports would still indicate a flag on the report.

The company’s policy could have harsh impacts on consumers if potential creditors checked an Equifax report compared to reports from the company’s two competitors. A flag on a person’s credit report may affect their ability to find a job, rent an apartment, obtain a mortgage, buy a home or conduct business. Reports from Equifax affected debtors disproportionately.

A Chapter 13 bankruptcy is a way for many debtors to restructure payments made to creditors. A Chapter 13 bankruptcy differs from a Chapter 7 bankruptcy. A debtor who has filed a Chapter 13 bankruptcy must make payments in accordance with the Chapter 13 plan for several years before their unsecured debts can be discharged.

A person who is considering filing for bankruptcy may wish to consult an experienced attorney. A bankruptcy lawyer may be able to help debtors determine which type of bankruptcy is right for them.