Why is Chapter 13 better for credit than Chapter 7?
A. The old school lenders and established banking institutions will give you extra credit for making your “best efforts” to repay as much debt as you can. Short term lenders looking to sell you on more debt just want to see that your credit report is clear of old debt and credit lines before giving you a new loan. Both forms of bankruptcy can improve your credit, however Chapter 13 is considered a little better for credit over the long run.
