Can I Apply for a Loan If I File for Bankruptcy in Mississippi?

By Super Lawyers staff | Reviewed by Canaan Suitt, J.D. | Last updated on June 30, 2025

Bankruptcy offers a potential path to solvency for financially distressed borrowers. If you are considering seeking bankruptcy protection, you may have reasonable concerns over how filing will affect your credit rating. Will a Chapter 7 or Chapter 13 bankruptcy affect your credit score? Will you ever be able to apply for a loan again?

Bankruptcy Will Adversely Affect Your Credit

As a starting point, consumers should be aware that bankruptcy will reduce their credit score. Although filing for personal bankruptcy is the best available choice for some, it doesn’t come without its costs.

It’s difficult to put a precise number on it—and the extent of the impact depends entirely on each individual situation—but a bankruptcy filing can reduce a credit score by more than 200 points. This is, of course, significant, and it must be considered when weighing bankruptcy versus other debt-relief options.

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Borrowers Can Rebuild Credit for Personal Loans

Though bankruptcy will damage your credit rating, the negative effects are by no means permanent. First and foremost, bankruptcy will not remain on your credit report forever. According to The Mississippi Bar, an official record of a Chapter 7 bankruptcy will remain on an individual’s credit report for 10 years—the maximum term a bankruptcy can be reported. A Chapter 13 bankruptcy will only remain on a credit report for seven years.

Of course, there are steps that borrowers or lenders can take to rebuild their creditworthiness immediately after a bankruptcy filing. In fact, your score can even rise while the bankruptcy is still on your report.

Among other things, borrowers looking to rebuild their credit should start by adding new credit—generally through secured credit cards or small-loan installments. From there, every monthly payment should be made on time regardless of low or high interest rates, and overall credit utilization should be kept as low as possible. In many cases, a person who has filed for bankruptcy can get approved for new unsecured loans as quickly as a few years with on-time payments and good credit history.

Finding the Best Path to Financial Solvency

Before filing for Chapter 7 or Chapter 13 bankruptcy protection, it is strongly recommended that a person consults with an experienced Mississippi bankruptcy lawyer. Filing for bankruptcy protection is a big decision, and it’s also procedurally complex. In some cases, it may not be the best path to financial solvency; other alternative financial options that cause less damage to a person’s credit may be preferable.

If you are financially distressed, you should always be prepared to seek the advice of an experienced Mississippi bankruptcy attorney about your financial situation and debt consolidation options. Here are some questions to an ask attorney:

  • What are debt management strategies if I’m struggling to make loan payments?
  • Is a Chapter 7 liquidation or Chapter 13 repayment plan best for me?
  • How will bankruptcy impact my credit limit?
  • How long must I wait after a bankruptcy proceeding to apply for a new loan?
  • What types of loans should I avoid?
  • What is the difference between secured debt and unsecured debt?
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