Q: I am having trouble renting an apartment because of a dismissed Chapter 13 Bankruptcy. Can it be removed from credit reports since I did not continue with it and the debt has since been paid in full?

A: A discharged bankruptcy means you have satisfied the debts included in the Chapter 13 BK and that creditors will not further pursue you for payment. In addition, discharged debts listed on your credit report must be listed as discharged. This will either lower or eliminate your overall debt making you are better credit risk.

When a Chapter 13 has been dismissed, creditors can immediately pursue you for payment again in addition to initiate or continue with court litigation for payment which causes potential new creditors to deny you.

Even if you pay the debt, potential creditors are still going to look at a “dismissed” bankruptcy more negatively than a “discharged” bankruptcy. Unfortunately, when you attempt to get new credit with a dismissed bankruptcy it’s going to be more difficult.

Most creditors, lenders and rental companies want to see a “discharged” bankruptcy. It’s great that you paid the debt but ironically there’s no benefit to your credit profile for doing so.

Once a bankruptcy is “filed” it is almost impossible to un-ring the bell. But because a discharged Chapter 13 stays on your credit report for 7 years and dismissed Chapter 13 stays on your credit report for 10 years I suggest several strategies:

  • Shore up your credit profile with a current positive payment history with the creditors you currently have. Bankruptcies can be disputed but since they are a matter of public record in Pacer, they stand to be reinserted even if you are successful with a deletion. As far as potential landlords, talk to them personally and explain your situation. Point out recent on-time payment history and employment stability. If possible, offer to pay more in security deposit.
  • Dispute the bankruptcy listing with each of the 3 major credit bureaus by doing the following:
  • You can dispute it with the credit bureaus and if the court fails to reply to the investigation it could be removed.
  • Or, you can dispute any inaccurate information pertaining to the bankruptcy listing such as clerical errors and mistakes in dates, amounts, etc. This type of dispute is backed by the FCRA’s guiding principle that information on credit report must be true and accurate which means that a bankruptcy can be removed if there is inaccurate information. Of course the credit bureaus could correct the inaccurate information causing the bankruptcy to remain.
  • I found this old bankruptcy dispute letter floating around on the “internets” that seemed to work for some. You may want to edit to fit your situation but here it is:

To Credit Bureaus:

I am disturbed that you continue to list the dismissed bankruptcy as confirmed within my credit file. Although it is your policy to keep reporting bankruptcies that are filed, dismissed or adjudicated for ten years, the Fair credit Reporting Act mentions nothing in Section 1681c relating to bankruptcy about dismissals or filings. The law clearly states from “date of adjudication” or date of “order of relief”.

Any case, civil or otherwise, which is dismissed no longer exists in the eye of the law and a case filed may never have actually been adjudicated. Therefore, you have no right to maintain information which the government has deemed nonexistent.

Therefore, pursuant to Section 1681(a)(5) of the FCRA, you must delete this information from my credit report and send me an updated copy when this action is completed.

Considering that this does not require an investigation, I would appreciate your response within 14 calendar days from receipt of this letter.



(letter courtesy of creditboards.com)



James Robert Deal
Real Estate Attorney & Real Estate Managing Broker

PO Box 2276 Lynnwood WA 98036
Law Office Line: 425-771-1110
Broker Line: 425-774-6611
Cell & Text Line: 425-670-1405
KW Everett Office Line: 425-212-2007
Fax: 425-776-8081

I help buyers, sellers, brokers. Flat fee payable at closing.
Property search: JamesRobertDeal.com


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