Getting Credit After Credit Card Bankruptcy
Filing credit card bankruptcy is often seen as an end to the sum total of an individual’s credit history by many people. After all, once you’ve hit the point that bankruptcy is the better of two options, your chances of ever getting a new credit card is slim to none, right? After all, abusing credit cards led you to this point, right? Why would they give you the chance to do it again?
Still a Chance
Well, the answer is simple, if a tad cynical. Credit card companies like money, and even if you went into bankruptcy the first time, there’s still the chance to squeeze a few more bucks out of you the second time around. In essence, as long as you have some form of money, credit card companies will, by and large, be happy to issue you credit in order to better get at said money.
Still Need Credit
Simple enough, right? But why would you want to get a new credit card in the first place, after what happened the last time? Have you ever heard of getting back up on the horse that threw you? The same principle applies to credit. In today’s predominantly cashless society, credit is a necessary evil for most major transactions. If you want to buy a home or a car, or just rent one or the other, you’ll need some form of credit. And if your credit has been tarnished by bankruptcy proceedings, then getting a new line of credit will help repair the damage.
Words of Warning
However, while there are a wealth of credit card companies who are happy to extend credit to the recently bankrupt, you’ll want to watch out for the hidden booby traps that invariably show up in such an arrangement. Some companies make it a point to prey on the recently bankrupt and charge outrageous interest rates and fees. While the recent legislation enacted by the United States Congress regarding credit card interest rates and fees will mitigate some of this, keeping a wary eye on your credit agreement is always suggested for the recently bankrupt.
Don't Make Same Mistakes
Too, keep in mind that a second chance is not an excuse to make the same mistakes the second time around. In some ways, bankruptcy can be seen as, in effect, wiping the slate clean on your previous credit problems. You want to make sure that you don’t travel down the same path again. Try to get a secured credit card, with a set credit limit and a secured interest rate. Don’t expose yourself to unnecessary temptation, if at all possible. If a secured credit card isn’t an option, for whatever reason, remember that the less time between your bankruptcy and getting the new card, the higher your interest rate is likely to be. It’s a good idea to be sure of your financial situation before embarking on an attempt to rebuild your credit.
Credit is important, but if you’re careful, you can do without it. If you’ve just undergone a credit card bankruptcy, considering waiting for a year or so, if possible, before attempting to rebuild your credit