Credit Card After Bankruptcy

You may be finding difficulty in getting a credit card after bankruptcy owing to bad credit score on your credit report, which remains for 7-10 years; this however must not be a setback for you. You must aware about credit card and interest rate available with credit card.

You are still eligible for a credit card designed for people with bad credit report. Credit card companies will come to your aid, but you will be expected to pay a higher rate of interest, and on your part you need to build the trust.

You can choose from the secure or the unsecured card. A secured card is secured against your personal saving account. Here your credit limit is determined by the amount you have in your deposit.

The credit card lender has less risk or no risk at all because; he will be able to claim your savings, in case you fail to make payments.

An unsecured card is the standard one, used by all, you are allowed to use it for purchases, and pay later or with an interest if you fail to pay within a month. Sad but true, people with bad credit score and especially bankrupt, are less considered for unsecured cards.

Given the difficulty in getting a credit card after bankruptcy, consider yourself lucky, for some online credit card lenders are still willing to let you an unsecured credit card, provided you are ready to pay high interest and face stiff penalties.

These ‘higher rate credit cards’; will do you no good if you cannot control your expenses. You will only land up in a situation worse than you began.

Your best choice for a credit card after bankruptcy thus has to be a secured card.

Once you are decided, look for a pre-approved card and read the terms carefully because credit card after bankruptcy comes with high rate of interest, plus there are additional charges like the maintenance and heavy penalties.

If you want, you can go for a little less interest rate, give reasonable explanations to your credit union, why you cannot afford high interest rates. Be 100% sure of the fine print. You can also ask for friend or your spouse to be your co-signer, you may get a credit card, if he or she has a good credit score.

Eventually if you fail to make payments, your co-signer will also be responsible; hence you need be serious as far as making payments is concerned.

You must consider your credit card after bankruptcy as an opportunity to improve your credit score. Make regular payments and let them know that you have become responsible and trustworthy.

In about two year’s time, your secured card will automatically get upgraded to an unsecured one and you can also claim your deposit back.

Discipline yourself when it comes to using your credit cards, curtail your spending habits. A little sacrifice will surely ensure you freedom from your bad financial situation in no time. A bad credit score must not be a way of your life.