Let’s talk about credit cards after bankruptcy. One misunderstanding people have is that it will be impossible for them to get a credit card after filing bankruptcy. Not only isn’t that the case, but, probably within weeks after a filing, credit card offers will start arriving in your mailbox! Having practiced bankruptcy law in Indiana these many years, I can tell you that these first offers are probably not the ones you’d want to latch on to. Reading the fine print will undoubtedly reveal lots of extraneous fees. These could take the form of monthly fees, annual fees, fees for just applying, or “membership” fees. You name it, these credit cards probably have it. But, if you can wait just a little while, as you being to rebuild your credit, better offers will be sure to come along, and then you would be wise to actually apply for a credit card.
Wait a moment, you say! Not managing credit card debt played a large part in bringing me to bankruptcy in the first place. Why would I want to start that process all over again? The principal reason for getting a credit card in place as soon as a reasonable offer comes your way is for emergencies. After filing bankruptcy, you don’t have cash on hand. So what happens if your car breaks down, you need new tires, the heat pump in your house goes out, or you need dental surgery that isn’t covered by insurance, or – any one of a thousand different everyday emergencies that are an inevitable part of life? That’s where a credit card can actually help you stay on track, rather than having your entire credit rebuilding plan derailed by an unpredictable emergency event.
So, yes, go ahead and get that new card. And then, just to prove to your creditors and to yourself that you are firmly in control – make a payment every month and pay the new card off just as soon as you possibly can.