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Chapter 4. Credit Scoring Myths > Myth 9: Credit Counseling Is Worse Than Bankr...

Myth 9: Credit Counseling Is Worse Than Bankruptcy

Sometimes this is phrased as “credit counseling is as bad as bankruptcy” or “credit counseling is as bad as Chapter 13 bankruptcy.” None of these statements is true.

A bankruptcy filing is the single worst thing you can do to your credit score. By contrast, the current FICO formula completely ignores any reference to credit counseling that might be on your credit report. Credit counseling is treated as a neutral factor, neither helping nor harming your score.


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