Rebuilding credit after Chapter 7 bankruptcy

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Rebuilding credit after Chapter 7 bankruptcy

Postby ColonelSandurz » Tue Feb 11, 2014 11:43 am

So I was hoping for some guidance about getting a credit card to start rebuilding my credit after bankruptcy. Here's the info:

- Declared personal (Chapter 7) bankruptcy at the end of Feb, 2013 - it was discharged in June 2013
- I included the following banks in the chapter 7 bankruptcy: Bank of America, American Express, Barclays, Chase, Citibank, and Sears (not all of these had active accounts with balances I owed, but my bankruptcy attorney had me include everything)
- I pulled my credit reports a few months after the bankruptcy was discharged and then begin correcting what I could on there - pulled them again recently and Equifax still has some mistakes but Experian and TransUnion seem to be correct now
- My FICO scores are:
- Equifax: 617
- TransUnion: 645
- Experian: 615
- I applied for a business credit card from Bank of America a few months ago and was told I didn't qualify but could get it through a secured means if I wanted (I have an LLC)
- Last night I applied for an unsecured card from Capital One and was turned down (am waiting for the letter to arrive to request reconsideration over the phone); also applied for a Barclays card and was turnd down (also was turned down on request for reconsideration because I had included them in bankruptcy - I know it was unlikely that I would get this card, but given that they seemed to use TransUnion for their credit pulls based on and my TransUnion score was the highest, I figured I'd give it a shot).

Now that I've already had these two (actually three if you count the Bank of America app a few months ago) hard pulls on my already damaged credit, I am not sure what to do next. I'd very much like to see if there's any way to get an unsecured/no annual fee card to help rebuild my credit (even if it's a small credit line) since I'm being very careful in watching my money since the bankruptcy and would prefer not to spend money on an annual fee or security deposit. Anyone have any ideas?

If there is really no way to accomplish this, I guess I'd consider a secured card with an annual fee (although if that's the only choice, I might just opt to do nothing right now since I'm surviving OK using cash/debit card). I've read that the capital one secured card is the best (in that it has a low annual fee and a small security deposit required). Any thoughts?

Also, is there anything else I could be doing to rebuild my credit? I believe (although am not 100%) that if I could get a co-signer I could probably get some of these unsecured/no annual fee cards and use that to rebuild credit, but unfortunately can't find one currently. Any ideas are welcome regarding rebuilding my credit.


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Postby takeshi » Wed Feb 12, 2014 9:16 am

I had to go secured initially to rebuild and actually used Capital One. A credit union is the other general recommendation for builders/rebuilders as some of them have more lax criteria for their members. After some rebuilding with the secured CO card I was able to get USAA to approve me and they definitely helped with that stage of my rebuilding.

If you intend to apply with any of the creditors that were included in the BK you'll need to pay them as a rule of thumb.

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Postby MemberSince99 » Wed Feb 12, 2014 12:36 pm

Agree with Takeshi. Applying with prime lenders now, most especially the ones you just IIB is going to be very unproductive as you've seen. Try Takeshi's suggestions. There is always First Premiere and Credit One who market to people in your situation. If you are just looking for a way to start over with great cards right after BK, well all I can say is let us know if you come up with a way to accomplish that on your own with no co-signers/shortcuts - I can't think of any way but I'd love to learn about one if it exists. I mean sure, you'd love to go right to Primeville right after BK, who wouldn't, but hey I'd love to get a supermodel and a mansion without the income to support it, good luck to us both hey?

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Postby PowerMan572 » Wed Feb 12, 2014 7:05 pm

I didn't file for Bankruptcy, but I had to charge off 3 credit cards in 2011/early 2012 to get my finances back in order. In spring of 2012 I did apply for the Capital One secured credit card you mentioned and I got approved. I sent them a $200 deposit and was offered a $351 credit card limit. After about 6 months of paying my balance in full each month they bumped my credit limit up to $451. That is where it remained until I just closed the account less than a week ago.

I now was able to apply for 3 rewards credit cards this past week and got approved for all! Since I had a Secured credit card with Capital One and I didn't mess up with them at all (not even 1 late payment) they approved me for their Venture card with $5k limit.

I guess I would recommend the Capital One secured credit card. It did wonders for me the for the 2 years I had it. You may be fine surving now on cash and debit, but if you want to start working on rebuilding your credit then a secured credit card is a start. That's where I started and it's going to take years to fix. Even when I applied for these credit cards last week the credit limits on 2 out of the 3 are very low (under $1,200 limit) because I still have those negative marks on my history. However, without the secured credit card showing 18 months of good payments, I probably wouldn't have gotten any of these rewards credit cards.

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