Credit Cards After Bankruptcy

Credit Cards After Bankruptcy

Credit cards after bankruptcy are not the easiest thing to get but it is perfectly possible if you take some time to prepare. Filing for personal bankruptcy is never a easy choice, but you can come back from it and build a perfectly good credit score over time if you are willing to put in the long term work that is required. To rebuild your credit after bankruptcy you need to take certain steps and be ready for the long haul.

Credit cards are a part of modern life for many people and you will be able to get one again in time but before that happens you need to take some steps and learn some lessons.

  • Take fiscal responsibilty for your self, no one makes you buy anything and many people live without cable TV by choice to save the $70 a month bill that comes with it.
  • Don’t do the same things that got you into trouble before. If you have a big car and a house that you could not really afford do not aim for them again. Do not borrow money to buy items that you do not really need, no one has to have a 48 inch television.
  • Look at your habits. If you smoke or like to drink expensive coffee or wine, you must stop or tone it down dramatically. The less you spend the more chance there is that you will never again need credit.
  • Be honest with yourself. It took you years to get into financial trouble and it is going to take years to get out of it. There is no instant fix for bankruptcy.
  • Do not expect to see a improve credit score overnight, it won’t happen and anyone who tells you that they can repair your credit instantly after bankruptcy is not being totally honest.
Credit Cards After Bankruptcy

Credit Cards After Bankruptcy

Manage your Credit
One of the few ways to get credit cards after bankruptcy after bankruptcy is also one of the best ways to rebuild your credit. A secured credit card will show lenders that you can manage your money effectively and because the card is backed by a deposit of your money there is no risk factor for the bank. You will not be able to get yourself into debt with a secured card from your bank, but no one needs to know that it is not a normal card as they do look exactly the same. As long as you keep paying the card off each month there will be no fees and over time these regular payments can be used to show that you are able to manage your money responsibly again.

Secured Credit Cards
A secured credit card may seem like a crazy idea, if you had the cash to spend you would not need a credit card. A secured credit card is the only type of credit card you will be able to get for a long time after being declared bankrupt.The reason you should get a credit card backed by security is not so you can spend money you do not have but so you can build up your credit rating. If you have been through the process of filing personal bankruptcy you know your credit rating is going to take many years to get back to the desirable level but the sooner you start working on it the sooner you will see a increased score.

Stay Away From Short Term Loans
When you have no money and can not just pull a credit card out of your wallet it can be tempting to take out a short term loan. These are generally known as pay day loans and they are all too often the path to financial disaster. If you miss a payment the interest rate climbs to astronomical rates and it becomes a ball of debt that gets heavier and heavier and at some point becomes almost impossible to pay off.

Every Penny Counts
A wise man once said that what you earn doesn’t matter as much as what you spend. This is especially true for anyone who has been through bankruptcy, the only way you can get truly out of debt and back to life long financial well being is by spending less than you earn. You can do more hours or find a new job to increase your income, but you must think about what you spend. Some people will take a notepad along with them and record every penny they spend, no matter whether it is on a newspaper or a coffee.

It’s No Fun
I know that being declared bankrupt is no fun, you were used to just getting out your credit card whenever you wanted to,  but you can work your way out of it and you do not have to ever go through bankruptcy or money problems again. You are in charge of your own destiny and using a secured credit card as one of your first steps away from bankruptcy is a good move.

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