If you have filed for bankruptcy, your access to credit cards is probably very limited. This can be especially troublesome if you have also lost your bank account in your bankruptcy.
The unfortunate reality is that you may find yourself without access to either a credit or debt card.
Living without credit isn’t easy in our society. Things that you may have taken for granted, like renting a car or a U-Haul may become challenging. Even ordering prescriptions online to save money becomes impossible!
While there is no “credit card for bankruptcy”, there is an option. Until you receive your bankruptcy discharge, you will want to use prepaid debit cards in the place of credit or debit cards.
Prepaid debit cards can be found in many locations. You can get one online or even stop by your local Wal-Mart and pick one up! Basically, you make a deposit with the card issuer and they give you a card valued in that amount. You can add funds to your account from many ATMs. Many will even accept your paycheck as a direct deposit.
Once you have your card, you can use it just like you would a debit card. Unlike a credit or debit card, any charges over the amount that is currently in your account will be declined. This is actually a good thing because it helps you avoid fees!
Once your bankruptcy is discharged, you will want to begin the credit restoration process immediately. One of the best ways to do this is with a post bankruptcy credit card. While you may think that it will be impossible to qualify for a credit card immediately after your bankruptcy, this isn’t entirely true. Certainly you will pay a higher interest rate, but there are many companies are willing to offer you a credit card after bankruptcy.
The easiest thing to do is apply for secured credit cards after bankruptcy. This works in a similar way to the prepaid card in the sense that you will be required to make a deposit in order to be granted a credit card. Unlike a prepaid debit card, a secured card will require a monthly payment and will help you reestablish your credit. The key is to look for one with low fees that also reports to all three credit bureaus.
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