A bad credit score can have a serious negative impact on many aspects of your life. Unfortunately, many residents in South Carolina are struggling with bad credit. In fact, according to a recent article published in USA Today, Columbia, South Carolina, is one of the metro areas with the worst average credit scores in the entire United States.

Our Columbia, SC bankruptcy attorneys are concerned to hear that so many people in the area are coping with bad credit. We urge residents to understand the steps that they can take in order to begin improving their credit. We also want to ensure that residents understand that bankruptcy can sometimes be the first step in rebuilding your credit, despite what you often hear about bankruptcy being a credit killer.

Columbia, SC Residents Struggle with Low Credit Scores

USA Today published an article on February 7, 2013 that discussed the results of a report recently released by TransUnion. TransUnion is one of the three major credit reporting bureaus in the United States (along with Equifax and Experian). The TransUnion report listed average credit scores for people in different parts of the United States, so it was easy to see where people were faring the worst as far as their credit scores.

According to their list, Columbia, South Carolina, was one of the worst metro areas, with an average credit score for residents of only 650. Areas that did worse included Memphis, Tennessee, with an average credit score for residents of 638; Jackson Mississippi with an average score of 642; El Paso with the same average score of 650; and a city each in Texas and Arkansas. Las Vegas-Paradise also tied with an average score of 650.

Credit scores are determined by several key factors including your payment history; the amount of credit that you have available to you that you’ve used; the age of your credit cards; the type of debt you have and the amount of new debt you’ve recently tried to take on. A bad credit score – including below the 650 range – can result in higher interest rates and a denial of loans in certain cases. Auto insurers, employers and landlords also look at your credit score and a bad score can hurt you there as well.

Can Bankruptcy Help You Rebuild Your Credit?

For those with low credit scores who are struggling, rebuilding your credit usually centers around paying down debt, making payments on time and waiting for negative information to drop off of your credit report. In some cases, however, if you are drowning in debt then the single best thing you can do is to file bankruptcy.

This may come as a surprise to some because you may have heard that bankruptcy is bad for your credit. It is, of course. However, so is getting month after month of negatives posted on your report if you can’t pay your bills. Bankruptcy can allow you to stop the negative data by eradicating your debt or getting you onto a payment plan. Once this happens, you can start to rebuild your credit. For certain people, therefore, who can’t pay their bills and who continue to have their credit scores go down as a result, bankruptcy can be the first step in the road to recovery.

If you are considering bankruptcy, contact the Columbia, South Carolina attorneys at Matthews & Megna today at 877-253-7705.