Moneybox

Re: Bankruptcy?

commenter — Tue, 15 Apr 2008 19:44:14 GMT

People that have just declared bankruptcy get a huge amount of credit card offers, for two reasons:

1) People who mismanage their money are credit card companies' bread and butter. Very financially responsible people - those who pay their credit card balance in full every month - are actually labled "deadbeats" by the credit card industry because every month they are extended up to a month of credit for free (other than small fees that merchants pay).

People who keep high balances with outrageous interest, on the other hand, are pure profit centers. This is the kind of customer that the credit card companies hope someone fresh out of bankruptcy will become.

2) After someone declares Chapter 7 bankruptcy it usually cannot be declared by them again for seven years, so there is almost no risk that someone fresh out of bankruptcy will be able to declare bankruptcy.

you would be surprised

Days — Tue, 15 Apr 2008 19:35:02 GMT

It took me nine months to get my first new card after chapter 7 bankruptcy. Within two years I had a half dozen new cards and one of them gave me a 5,000 credit limit.

I quit payment on all the cards, after four years of rebuilding. But I had managed to acquire ten new cards in that time. Now my credit has a bankruptcy and write offs on ten credit cards since the bankruptcy. How long do you think it will take before someone offers me a decent loan? My guess is five years.

When my sister filed for bankrupcy,

Tundrayeti — Tue, 15 Apr 2008 18:55:47 GMT

she started getting "pre-approved" credit card applications in the mail after only 5 months.

She had just separated from her husband, only had ~20,000/year income, and had a child... not exactly the picture of financial stability.

She got a mortgage to buy a house three months shy of two years after her bankrupcy.

Re: Bankruptcy?

smslaw — Tue, 15 Apr 2008 16:05:29 GMT

You need to get a new card before filing bankruptcy. If you don't owe any money on it when you file, it will not be cancelled. You can still use it after filing, although the interest rate on any unpaid charges will be very high.

Re: Bankruptcy?

kwheless — Tue, 15 Apr 2008 13:58:12 GMT

Depends on what you mean by "useful limit". My Dad declared bankruptcy twice, and within a couple of years, he was able to get credit cards - the first ones were secured cards, but within another six months to a year, he got a "high risk" card (with a fairly low limit and a high annual fee) and then back to regular cards (albeit with high rates). Within about 4 years, he owed tens of thousands on his cards again...

And he had a very low income after the bankruptcy, living off a pension. If he'd had a higher income, I think it would have been easier for him to get cards with a higher limit more quickly.

Re: Bankruptcy?

Wall Street — Tue, 15 Apr 2008 13:12:31 GMT

Seriously. Seriously. Damnit.

Bankruptcy?

Wall Street — Tue, 15 Apr 2008 13:08:15 GMT

"...unsurprising as the once inconceivable idea that you can get a whole batch of new credit cards two years after a bankruptcy."

I doubt this very much. I haven't declared bankruptcy (yet!!) but seriosuly, I doubt there are any lenders willing to give you a credit card with any sort of useful limit 2 years after you declare bankruptcy. Does anyone have any experience with this sort of thing?