The filing of a bankruptcy obviously negatively effects a credit score, but not as much as you might think.  The negative effect of a bankruptcy starts diminishing the day that the bankruptcy is discharged.  The filer is often inundated with offers for new credit as soon as they file.  There are reports of people with FICO scores over 700 as soon as 24 months after discharge.  However, every case is individual and FICO scores will vary.

Bankruptcy filers are, oddly enough, excellent credit risks.  The theory is that the applicant cannot file for bankruptcy for the next 7 years and thus the chance of recovering the debt is high.  If used properly and conservatively, the new credit cards can be used to establish a good new credit history.

Each and every lender treats bankruptcies differently.  Some lenders will lend as soon as 12 months after discharge of a Chapter 7.  The average is somewhat longer, usually about 16-20 months, depending on the terms of the loan.  A mortgage is an excellent way of establishing new credit history and quickly pump up a FICO score.