How to Apply for a Credit Card After Bankruptcy

Establishing good credit after filing for bankruptcy is difficult, but not impossible. Before you apply for a credit card following your bankruptcy, think carefully about what you need and what you are willing to settle for.

Instructions

1. Apply for a credit card only after you have a clean slate on your credit report. Depending on the state in which you live, you may need to wait a period of months or years before your credit report is clear.

2. Determine what your minimum credit limit should be before you applying for a new credit card. Compose a monthly budget to determine how much you can afford to pay.

3. Take a look at the grace period for repayment. Since interest isn't charged on balances paid within a certain period, you can improve your credit and hold on to some money by making payments within this time.

4. Review offers for unsecured credit cards carefully. Though these are easy to get, issuing companies usually charge large maintenance fees and high interest rates for cards with relatively low credit limits.

5. Research the possibility of a secured credit card through your bank or lending institution. This type of card is given on the condition that you maintain a certain minimum balance in a savings or checking account of the issuing institution. Generally, the line of credit will equal the amount kept on deposit.

6. Confirm that any institution issuing you a credit card will be reporting your good credit behavior to the credit bureaus.

7. Apply for a card that offers a balance between a lower interest rate and reasonable maintenance fees. You can determine this by creating a chart using Excel or other software, and itemizing information such as introductory and continuing APR, monthly or annual fees, late and over-credit limit penalties.

Tips & Warnings

• If you decide to go with a secured credit card, look for an issuer that is willing to convert the card to an unsecured one after you have made timely payments over a set period.