How to Get an Unsecured Credit Card After Bankruptcy

You may think that once you’ve filed, you can’t get an unsecured credit card after bankruptcy. If you want to know how to get an unsecured credit card after you’ve filed bankruptcy, this article will show you how.

What’s an Unsecured Credit Card

Most people don’t know that there are two different kinds of credit cards. A secured credit card has a bank account tied to the card that is collateral for the card, in case you can’t make the payments. You can’t spend over the amount that is in the account.

An unsecured credit card doesn’t have any safety nets. Whether you get the card, and your limit if you do, is decided by your credit and your income.

If you decide to apply for an unsecured credit card you have plenty of options to choose from. In fact, you might feel a little overwhelmed. Banks and Credit Unions offer them, as well as many retail stores, and places on the Internet. You can even fill out applications right on line that can tell you in a matter of minutes whether you are approved or not.

Picking the Right Card

There are some questions you need to ask before you get a card anywhere. The first thing that you need to look at is the interest rate. Some unsecured credit cards have very high rates for people who have filed bankruptcy. But there are a few out there that will save you a lot of money in just interest. You also want to check to see if it’s a variable interest rate or fixed. Some credit cards will significantly raise your interest rates for what seems like no reason, or because of a late or missed payment. Know the conditions of the rates.

Check the fees. Some cards charge outrageous application fees. If you have a low limit on your card, just the application fee in itself can take up most of the card. You’ll also want to see if there are annual fees, maintenance fees, fees for making the payments in a certain way and fees for being late. As a matter of fact, there are so many different kinds of fees that they can tack on without you knowing, you may want to ask them for a plain list before applying.

It’s also very important to see whether the card reports to the three major credit bureaus. If you are doing a good job of making your payments on time, but that isn’t reported, you won’t be helping your credit score at all.

The Limit is Low

It’s important to know that the credit limit on the card may be only $200 - $500. You might be disappointed, but it’s in your best interest. Having a low credit limit will help you avoid being unable to pay your card off. The good news is that sometimes in as little time as a year, you can request to have your limit raised. Of course you want to check to make sure that the card doesn’t charge a separate fee for the request.

It’s Not Impossible

Finding an unsecured credit card after filing bankruptcy isn’t necessarily impossible, but it will take some research on your end. Be patient, and don’t apply for everyone you find. Find out from the card company what their policies are on issuing credit with a bankruptcy on your record and then make an informed decision.

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