Managing your personal finances continues to be an important personal responsibility. Unfortunately, a lot of people will find that this is becoming harder every year. If you are in a tough financial position, filing for bankruptcy protection can be a good idea. While bankruptcy can help you regain control of your personal finances, it does have a long-term impact on your credit report. This can impact your ability to take out any type of debt, including a credit card. There are several factors that can influence whether you are able to apply for a new credit card, and receive approval, after filing bankruptcy.
Type of Filing Pursued
When meeting with a bankruptcy attorney high point and Greensboro NC area residents will learn more about their bankruptcy options. The most popular option for people tends to be Chapter 7, which is a full liquidation and will lead to the discharge of most debts. Another option is to file Chapter 13, which usually results in a financial restructure and may not fully eliminate your debt. During a Chapter 7 filing, the process is rather quick and can be over within a few months. Once this is done, you will have the ability to start applying for credit cards. With Chapter 13, you will need to wait until the reorganization and repayment plan is complete, which could take several years.
Time Until Approval for Most Cards
When working with bankruptcy lawyers in Greensboro NC residents will quickly find that filing can impact their credit history. With a Chapter 7 filing, the bankruptcy can remain on your credit report for up to 10 years. With Chapter 13, it will remain for 7 years. During this time, receiving approval for most credit cards can be difficult.
Open a Secured Credit Card
One of the challenges of bankruptcy is that you will have a hard time rebuilding your credit until the bankruptcy is removed from your credit history. However, many banks will still be willing to issue you a secured credit card. With a secured credit card, you will send them money as a deposit that will collateralize your credit line. There is ultimately no risk to the bank in these situations and your approval is far more likely. An advantage of this is that it can help you build credit and improve your score.
Another option to get a credit card after filing bankruptcy is to get a co-signor. With a co-signor, someone else will sign the application with you and will be named to the credit card account. This person is ultimately taking on responsibility for the repayment of the debt on the card. If they have a good credit score, the credit card provider may be willing to issue you the card by relying on the co-signor’s repayment capacity.
Filing for bankruptcy is always a big decision due to the impact that it can have on your financial life. When you are considering bankruptcy, it would always be a good idea to speak with a bankruptcy attorney in Greensboro NC. When hiring a bankruptcy attorney Greensboro NC residents will receive full consultation on their case. This will include learning more about their options, determining whether bankruptcy is the right decision for this situation, and receiving a full understanding of the long-term impact. If you decide that bankruptcy is right for you and need a Greensboro NC bankruptcy attorney, you should contact the Law Office of Mercedes O. Chut to learn more about your options. The team here can provide all the support you need including consultation, help with the filing, and support during negotiations with creditors.