How to Get a Credit Card After Bankruptcy

Millions of Americans will be faced with the choice of declaring Chapter 7 Bankruptcy every year. Many times they are victims of a poor economy, a loss of employment or even an unforeseen but major expense. While this may seem like the “end of the line” financially speaking, Chapter 7 Bankruptcy can in fact be a useful tool in turning your financial situation around. A major question that almost every individual who will declare Chapter 7 Bankruptcy is, “How/Will I be able to get a credit card after declaring Chapter 7 Bankruptcy”?

The primary focus for anyone who has successfully declared Chapter 7 Bankruptcy is re-establishing good credit. However, it may be possible to encounter difficulties when applying for new credit-cards with certain companies. Working with an experienced attorney can provide insight as to how soon you should wait before acquiring a new credit card. Typically bankruptcy attorneys are more knowledgeable about which banks or organizations are the most willing to accept applicants with a recent Chapter 7 Bankruptcy.

A good starting strategy is applying for a high rate credit card that only allows a limited line of credit. By keeping expenses to only the necessities and making payments on schedule (or even better, completely paying off the card at the end of each period so it does not carry over to the next billing cycle) then you will demonstrate your financial responsibility and may be entitled for better circumstances in time.

Here are some factors that every financial institution considers when reviewing a potential applicant:

  1. Employment history – This includes whether or not you currently have a job, how long have you been in your current position and if you have a steady, regular income.
  2. Current credit possession – This criteria would examine whether you currently possess any minor cards for certain expenses? Are you regularly paying off these cards? This would work in your favor.
  3. Home stability – Are you intent on remaining in the same area? It could make re-establishing credit easier if you demonstrate a willingness to stay in one place, the suspicion of being able to uproot quickly may give creditors cause for alarm.

Establishing credit is imperative for anyone following a Chapter 7 Bankruptcy case. Patel Law Firm specializes in Chapter 7 Bankruptcy and in post-bankruptcy counseling. Please contact us via email or phone for a free consultation.

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  1. […] good records of your credit cards. If you are having a difficult time managing several different credit accounts, it may be wise to […]

  2. […] How to get a credit card has been the topic of other blogs featured on this site. Re-establishing credit can demonstrate to a dealer or lender that an individual is able to make regular payments on time. There are research banks and financial institutions that are willing to work with people who are in the post-bankruptcy phase. Some options include undertaking an unsecured credit card or even a secure credit card that maintains strict limits. It is important to re-visit your credit reports after acquiring one of these cards to be sure that the credit line is showing up (lenders will check for this too!) […]