Can You Get A Credit Card During Bankruptcy?

Published on August 2, 2020 by J. Andrew Meyer

Can You Get A Credit Card During Bankruptcy?

Filing bankruptcy usually has the unfortunate effect of damaging your credit and credit score. Many people believe that this translates to being unable to purchase things on credit, or experiencing difficulty receiving loans at favorable interest rates. But what about credit cards? If you have already filed for bankruptcy and are looking to rebuild your credit, you may be wondering if it is possible to obtain a credit card prior to your bankruptcy case being completed. The answer most likely depends on the form of bankruptcy that you have filed and the type of credit card that you are applying for. Here’s more.

Chapter 13 Bankruptcy

As you may know, Chapter 13 bankruptcy involves a repayment plan in which you make monthly payments over a number of years until you have satisfied your debt. If you have filed for Chapter 13 and are still making payments, you are required to get approval from the court or trustee before applying to take on additional debt.

Also, you should be aware that most credit card companies may be unwilling to approve your application while your bankruptcy case is ongoing. One option that you may want to explore is getting a secured credit card. These cards require a cash deposit to be placed in an account before you receive the card. This serves to guarantee or “secure” any amount that you may charge on the account up to the credit limit. It is important to ask the bank if a secured card will be reported to the credit agencies as typically the purpose of getting a card during bankruptcy is to re-establish credit. If the bank or credit card provider does not report secured cards to the credit agencies, you may want to see if they would be willing to convert the card to unsecured status in the future.

Chapter 7 Bankruptcy

Much like Chapter 13, there is nothing that prevents you from applying for a credit card before your case is discharged. However, Chapter 7 typically takes much less time to complete when compared to Chapter 13. Additionally, Chapter 7 does not involve a repayment plan, but rather a discharge of debt. Waiting until after your debt has been discharged may be the smarter option as credit card companies may want to first see that you have cleared all of your outstanding debt before they approve your application. Still, if you would like to apply for a credit card prior to discharge, you may want to first check with your attorney before you make a decision.

Things To Remember

Rebuilding your credit after bankruptcy is key, but it is much more important to understand that taking on high interest credit cards may place you in the exact situation that caused you to file bankruptcy in the first place. If you are considering applying for a credit card during bankruptcy, it is recommended that you consult with an experienced bankruptcy attorney to make sure that you are not negatively affecting your case. Plus, you could learn about the best and safest option for rebuilding your credit.

Florida Bankruptcy Attorneys

The Bankruptcy Team, PLLC is dedicated to assisting clients fix financial dilemmas through bankruptcy, foreclosure or other viable means so that our clients are able to get the fresh start which they are entitled to. If you are contemplating filing for bankruptcy, modifying your mortgage, or are facing unmanageable credit card or student loan debt, we are here for you. Our experienced bankruptcy attorneys will thoroughly review your circumstances and will advise you about available options which closely fit your needs. To consult with The Bankruptcy Team, PLLC, call or contact us today.

J. Andrew Meyer

Andrew Meyer was born in Deland, Florida, in 1970. He graduated with an International Baccalaureate Degree from St. Petersburg High School in 1988, and attended the University of Florida, graduating in 1991 with a degree in Economics awarded with High Honors. Mr. Meyer also attended law school at the University of Florida, receiving his juris doctorate degree in 1995. While at the University of Florida, Mr. Meyer was inducted into Florida Blue Key and Phi Beta Kappa. Mr. Meyer was first trained as a lawyer by Richard T. Earle, Jr., and thereafter worked at the Attorney General's Office for the State of Florida in the Bureau of Criminal Appeals before becoming a senior staff attorney for the Florida Second District Court of Appeal. Mr. Meyer also served as a law clerk to the Honorable Chris W. Altenbernd, Retired, at the Second District Court of Appeal. Following his time at the Second DCA, Mr. Meyer worked at Carlton Fields, focusing his practice on appellate matters. In 2004, Mr. Meyer became an advocate for consumers as a partner at James Hoyer, and then later moved to Morgan & Morgan's class action department in 2009.

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Can You Get A Credit Card During Bankruptcy?