How to Obtain a Credit Card After Bankruptcy
Filing personal bankruptcy can be devastating. For up to the next ten years, every creditor who reviews your application will see the bankruptcy. This may result in higher interest rates on loans or even loan denial. However, rebuilding your credit after a bankruptcy is a surefire way to quickly erase the past and prove that your able to manage credit wisely. It's possible to achieve a high credit score after bankruptcy, and obtaining a credit card shortly after your filing puts you on the right path.
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Instructions
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Research different financial institutions and inquire about secured credit cards. Secured credit cards require a security deposit and they're intended to help people with bad credit or no credit build a good credit history. Not every bank offers secured cards. Call your personal bank first, then other banks in your area to see if they offer secured credit cards.
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Open a checking or savings account with the bank. If you plan apply for a secured credit card with a new bank, visit the branch an open a bank account. Some institutions require cardholders to hold a bank account with the company.
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Ask about fees associated with the credit card before submitting your application. Banks generally charge a one time set-up, monthly and annual fee.
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Give the lender your security deposit. Because secured credit cards are commonly used by people with shaky credit histories, banks will charge a security fee between $300 and $500. Your credit limit on the card will match your deposit, and you can achieve a higher limit by paying a higher deposit.
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Tips & Warnings
Not every bank reports secured credit cards to the credit bureaus. Regular updates are necessary to improve your credit after bankruptcy. Choose a bank that regularly sends updated information to the credit bureaus.
Paying your secured credit card bills on time every month is essential to rebuilding your credit score after bankruptcy.
Once you've demonstrated a good payment history, the bank may refund your deposit and convert your account to an unsecured credit card.
