People considering bankruptcy have many questions regarding how future credit will be affected. Some think that it will be 10 years before they can get credit again, or that they will never get a credit card after their bankruptcy.
Common questions debtors have are usually about keeping current credit cards, establishing new credit and buying a home.
If money is owed on a current credit card, then it must be listed in your bankruptcy forms as a debt. These forms are filed under penalty of perjury and if fraud is detected, your bankruptcy case can be discharged.
Also perjury is a federal crime punishable by a fine and time in prison. Neither circumstance is ideal for someone trying to repair his or her credit. But if nothing is owed on the card, then it does not have to be listed.
But this doesn’t necessarily mean you will get to keep your card. Your company may cancel your account as a precautionary measure.
Credit is now available to the recently bankrupt. Though most will find high restrictions such as lower limits and higher interest rates.
But it is not necessarily a good idea to start up right away with those credit cards. Usually it is what gets people into trouble in the first place. It is also important to avoid credit repair scams.
After filing for bankruptcy, many people are afraid they wont be able to buy a home for 10 years while they have a history of bankruptcy on their credit report.
Usually 18-24 months within a bankruptcy discharge, debtors can qualify for a loan on the same terms as if they had not filed for bankruptcy.
December 17th, 2008 at 2:42 pm
In Brazil there is no banckruptcy for people, just companies can discharge it. Credit Cards companies can suck all your pennies!
Empréstimo. A portal about Loans and Financing
December 17th, 2008 at 3:59 pm
There are a lot of people that file bankruptcy unnecessarily. If you create a budget and stick to it – you can usually figure a way out to make it. If you owe a bunch on your credit cards – call the companies and agree to a settlement amount. Usually 50 cents or better on the dollar. Just make sure that you get the agreement in writing before sending any money. Also – never ever give them electronic access to your bank accounts.
January 11th, 2009 at 8:18 am
Here’s a great article from the Department of Justice on the subject of bankruptcy and credit cards:
http://www.usdoj.gov/ust/eo/public_affairs/articles/docs/abi092000.htm
I hope you find it as useful as I did.
November 5th, 2009 at 2:22 am
The real danger is going through the bankruptcy without changing the behavior which caused it in the first place.
November 18th, 2009 at 3:17 am
other option are also available the secured credit card are now available. and even with the worst credit they will take you since you make a deposit for the limit to back it.
bankruptcy alone is a big bad spot on your credit record but it can be mitigate if around is ok. if it is a long time mess restoring credit can take longer and some more complicate way can be needed since lender will consider it .