Afraid you won’t get any credit card offers after bankruptcy? Believe, at best, you’ll be stuck with a small, secured credit card?
As Philadelphia bankruptcy lawyers we hear this fear every day. Fortunately, there’s good news. Typically, credit card offers come pouring in directly after your discharge.
There are several reasons. First, your credit score usually goes up after bankruptcy.
Second, the offers are risk free, at least for the credit card companies. If you filed Chapter 13, you must wait four years before you’re eligible for another discharge. If you filed Chapter 7, you’ll have to wait eight years.
This puts you beyond the reach of bankruptcy protection for a long time, which means credit card companies feel confident they’ll get paid.
Some more unscrupulous companies are counting on your fear, too.
Many people are so surprised and even grateful to receive credit card offers at all that they’re not as careful about researching the terms as they should be. Sky-high interest rates and hefty activation fees are common. Nothing like opening a card that has a balance before you even get the physical card in the mail!
You don’t have to take any offer right away. While you might feel you need at least one card to start rebuilding your credit, it’s important for you to make sure your financial house is now completely in order before you rush in. Credit cards aren’t the only way to build credit. For example, some apartment complexes will report your on-time rental payments to credit bureaus if you ask them to (of course, they’ll report your late payments too, so make sure you’re prepared for that), and securing a modest car loan might be a more immediate concern than obtaining new plastic. These alternate credit sources could nudge your score up even more, allowing you to get more favorable terms later.
If you are suffering from financial distress, your future relationship with credit card companies is probably the last thing you should be worried about. If you’re being threatened with repossession or lawsuits you need to move quickly. Even if you’re just being hounded by creditors on a constant basis, you’ve got a problem that needs to be solved.
There is life after bankruptcy. And there’s a good chance it will look far brighter than the life you’ve got today. Contact us now for your free consultation, so we can get you started.