subject: Credit After Filing Bankruptcy? Yes! [print this page] Do not worry about getting credit after bankruptcy. You can get it pretty easily. Years ago, we normally relied upon the banks providing secured credit cards to us in order to reestablish credit. While secured credit cards are still available, it is no longer necessary, in most cases, to obtain a secured credit card. Unsecured credit cards are generally available to everyone even a day after you have filed your bankruptcy case.
Getting approved for a secured credit card is pretty much a sure thing. In this situation, you would deposit a sum of money, as little as $200 in many cases, in the bank. You would not be able to access this money. It stands as a reserve to guarantee payment for the credit card that the Bank will issue you. So, you see, the card is secured by your bank account balance. A sure thing for the bank. If you do not pay your credit card bill when it comes due, the bank can take the money out of your account.
It is probably going to be possible for you to obtain an unsecured credit card even immediately after filing bankruptcy. Credit card issuers even target recently filed bankruptcy clients with offers of unsecured credit. Credit card issuers know that you can not file another bankruptcy for several years and that most of your other debt, if not all of it, has been discharged in your bankruptcy. It is clear that you are a better credit risk after filing bankruptcy than you were before you filed.
Be careful, however, when obtaining new unsecured credit after filing a bankruptcy. Credit card issuers frequently target consumers with credit cards that have lots of hidden fees and unnecessary insurance. It is not, in my opinion, a bad thing if the credit card issuer charges a monthly fee of less than $10, or if the card carries a higher interest rate. If you keep your balance low the cost of interest will be low. Similarly, a modest monthly fee is probably an acceptable charge when you are initially rebuilding credit after bankruptcy.
You should avoid disability insurance, non-payment insurance, and other charges that sometimes accompany offers of credit to people after they have filed bankruptcy. You do not need these additional products. I have seen credit cards that start out $180 in debt on a $200 limit. Obviously, this is not something that you want to do.
If you are worried about not being able to get credit after you file bankruptcy, relax. The days of it being hard to get credit after a bankruptcy filing ended long ago. The challenge today is to make sure that you do not get taken advantage of as you rebuild your credit after you file bankruptcy.
