Bankruptcy is not a pleasant thing. It ruins your credit, and takes a toll on your ability to borrow. Getting a credit card after bankruptcy is extremely difficult. What are the best credit cards after bankruptcy to obtain?
How to get a credit card after bankruptcy
You probably won’t be able to qualify for the easiest credit card to get or a regular unsecured credit card after bankruptcy. This is because most lenders will view you as too high of a risk to lend money to; they figure that you probably won’t be able to pay them back. But, life is not hopeless for you after you file bankruptcy.
Instead of going for an unsecured credit card after bankruptcy, try to get a secured credit card. A secured credit card is very similar, but you pay for your credit limit; your limit is determined by a deposit you make on these bankruptcy loans. The limit will be equal to the amount (usually) that you deposit. These types of credit cards almost always get approved, because there is no risk for the lender; if you don’t pay your credit card bill, they just take money from your deposit.
So, this doesn’t even really seem like a credit card at all, does it? Well, not only is it really a credit card, but it is the best credit card after bankruptcy. Secured credit cards will build up your credit (or damage it) just like any other credit card. So, when you get them, be sure to pay them off on time and settle credit card debt in the correct amount each billing cycle, and you can rebuild your credit.
It should take a couple of years of building your credit with a secured credit card before you can see signs of improvement. After a year or eighteen months, some lenders will convert your secured credit cards into unsecured ones. After a couple years, you may be able to apply for some unsecured ones directly.
Once you have gotten to this point, you should no longer use your secured credit card, as it probably charges high interest. But, do not close this card. The longer the cards on your credit history are, the better your credit score. So, keep these old cards, but do not use them.
So, after bankruptcy, get a secured credit card, use it for a couple years, then get some unsecured credit cards. Finally, stop using the secured ones, but keep them open. This is the fastest track to recovery after bankruptcy. Soon enough you’ll be on the track to getting even easy to get store credit cards with great rewards programs, because you’ll be back in the black, and out of the red.