How to Apply for Credit Card for People Who Just Went Through Bankruptcy

Even if you recently have filed for bankruptcy, it still is possible to apply for a credit card. While the bankruptcy may remain on your credit report for up to 10 years, most lenders will determine to approve or deny you credit on a case-by-case basis. Bear in mind that you will be considered a higher risk; therefore, any line of credit for which you might be approved will come at a cost. The positive news is that obtaining a credit card following bankruptcy will give you the opportunity to improve your credit score. If you go about it in the right way, you can be approved for a credit card, which will help you to regain a good credit standing.

Difficulty: Moderately Challenging

Instructions

1. Wait about two years after filing bankruptcy to apply for a credit card. While you may be able to get a card sooner, you likely will be approved only for a high-interest, low limit card with additional fees attached. A department store credit card may be easier to get at first, but comes with the price tag of high interest rates.

2. Apply for a credit card issued by a bank that specializes in accepting applications from those with poor or no credit history. Many card issuers charge high-risk consumers monthly and annual fees along with application and processing fees. You could be paying fees that total many times more than the low credit limit you will be allowed.

3. Use the credit wisely, and try to pay off the balance in full each month. Handling credit responsibly can get you regular increases in your credit limit. Do not get caught in the trap of making only the minimum payment due. In most cases, you won't even be paying down the debt. By paying more each month, you will pay off the balance more quickly and gradually increase the amount of credit available to you.

4. Avoid missing any payments or making late payments. You need to be able to show a clean record on your recent credit history, which means making at least six months of payments on time with no delinquencies.

5. Consider all purchases carefully. In the beginning, purchase only smaller inexpensive items that you can pay off quickly.

6. Submit an application for a secured credit card if all else fails. You will be required to make a deposit before being able to use the card. Your credit limit will be the amount of the deposit, or a major percentage. Although you are securing your own line of credit, by using the card and making timely payments, you will be improving your credit score. Eventually, you will qualify for a credit card that offers a better interest rate and higher credit limit.

Tips & Warnings

• Be cautious of scam credit card offers, which may offer you fast and easy pre-approval without a credit check, especially if you have poor credit. No legitimate lender can guarantee to give you credit without examining your credit report first.
• Beware of hidden terms included in some credit card contracts. Usually, there are certain conditions that apply, which can end up costing you more money in the end.

Resources

• Credit Cards for Poor Credit
• Family Credit Management

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