More On Credit Cards After Bankruptcy

Bankruptcy is not an easy thing to go through.  Your credit is ruined by it, therefore ruining your ability to borrow money.  Credit cards after bankruptcy are not easy to come by.  What is the best credit card after bankruptcy?

Getting a credit card after bankruptcy

It will be difficult for you to get a credit card after bankruptcy.   From your bankruptcy forward (unless you fix your credit score), lenders are going to see you as a huge risk.  They won’t want to lend money to you, because they figure that you’ll probably not pay them back.  However, this isn’t the end of the road; you can get back on your feet, but just know that there won’t be an easy to get credit cards and instant decision credit cards if you’ve had a bankruptcy – not for a long time at least. Remember that the easiest credit card to get is available only for a person who has a good credit score.

Don’t try to get an unsecured credit card after you file for bankruptcy, but instead, try to get a secured card after bankruptcy.  Secured credit cards are similar to unsecured ones, but your credit limit is secured; hence, its name.  Secured credit cards are secured by a deposit given by you, the credit card applicant.  Secured cards are almost always improved; they are the best way of getting a credit card after bankruptcy.  If you don’t pay your bills on an unsecured credit card, the creditor has no way of recovering its money.  With a secured card, however, it will just take money from your deposit.  So, that’s why these cards get approved so easily; there’s no risk to the lender.  Though it’s always the best practice to settle credit card debt every billing period if you can.

This doesn’t mean they can’t still ruin your credit, though.  Nonpayment or tardy payments on a secured credit card or other bankruptcy loans will damage your report just as much as with an unsecured, so be sure you pay them on time.  However, they don’t just damage it; they also build, too. After a period of time, usually one year or eighteen months, the creditor may convert your card into an unsecured credit card.  It may take a couple of years before you are able to apply and be accepted for unsecured cards.

Once you have an unsecured card, either by conversion or from applying, do not use your secured card anymore, as it likely has very high interest rates.  However, you should keep this card open, because the longer an open account stays on your credit, the better your score will be.  Keep this old card, but do not use it.

Basically, after bankruptcy, you’ll want to get a secured card, pay it off on time for a couple of years, then stop using it.

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