A Credit Card After Bankruptcy Comes With More Costs!
In spite of the stigma and possible embarrassment of filing for bankruptcy, many folks have mitigating circumstances that make it often their only option to bypass repeated court proceedings against them. One thing that often worries these people is the obtaining of a Credit Card after Bankruptcy.
However regardless to what some may think obtaining a credit card after bankruptcy isn't impossible. There are companies willing to provide this although normally you can expect high interest rates and additional annual fees.
As you may or may not know once someone has filed for bankruptcy they cannot do so again until seven years have passed. This is in fact one of the reasons why companies are even willing to provide credit cards in this situation.
You see normally credit card debt is considered un-secure, but when the person in debt cannot file bankruptcy the credit card company has the option to use wage attachment to get back the money.
Although these credit cards are available after bankruptcy they can be a risky option for some. Not only will you be dealing with higher interest rates but you will be charged on late payments and this can quickly add up.
Many companies offering a credit card after bankruptcy offer it as a help in rebuilding a credit rating and even with annual fees as well as processing fees, sometimes equaling the initial credit limit, people take them out hoping to get back on their financial feet.
Things can go from bad to worse
To put things into perspective let us say for example that your credit card after bankruptcy annual fees are $290 and your initial credit limit was $300, if you were only one day late for a payment you can expect on average to end up paying $30 as a late fee.
In turn this would push-up the liability to $320 which would cause another $30 fee for being over the limit, this means that the credit card holder would now have a debt of $350!
On top of all this since you have failed at this point in your obligations, your interest rate on your card can very quickly go to the maximum allowed by law.
There really is no way out either, with the exception of paying the balance on the credit card. Quite a lot of companies demand that the payment be made within 30 days and if that does not happen you would face collection action.
Daily phone calls, court proceedings, you name it, from here on in things can really get ugly and fixing the mess often takes several years.
As you can see although obtaining a credit card after bankruptcy is possible, the consequences if you are unable to keep up with payments can be very severe, so whether or not you should get a credit card after bankruptcy is going to depend on your situation and your ability to pay on time. - 23222
However regardless to what some may think obtaining a credit card after bankruptcy isn't impossible. There are companies willing to provide this although normally you can expect high interest rates and additional annual fees.
As you may or may not know once someone has filed for bankruptcy they cannot do so again until seven years have passed. This is in fact one of the reasons why companies are even willing to provide credit cards in this situation.
You see normally credit card debt is considered un-secure, but when the person in debt cannot file bankruptcy the credit card company has the option to use wage attachment to get back the money.
Although these credit cards are available after bankruptcy they can be a risky option for some. Not only will you be dealing with higher interest rates but you will be charged on late payments and this can quickly add up.
Many companies offering a credit card after bankruptcy offer it as a help in rebuilding a credit rating and even with annual fees as well as processing fees, sometimes equaling the initial credit limit, people take them out hoping to get back on their financial feet.
Things can go from bad to worse
To put things into perspective let us say for example that your credit card after bankruptcy annual fees are $290 and your initial credit limit was $300, if you were only one day late for a payment you can expect on average to end up paying $30 as a late fee.
In turn this would push-up the liability to $320 which would cause another $30 fee for being over the limit, this means that the credit card holder would now have a debt of $350!
On top of all this since you have failed at this point in your obligations, your interest rate on your card can very quickly go to the maximum allowed by law.
There really is no way out either, with the exception of paying the balance on the credit card. Quite a lot of companies demand that the payment be made within 30 days and if that does not happen you would face collection action.
Daily phone calls, court proceedings, you name it, from here on in things can really get ugly and fixing the mess often takes several years.
As you can see although obtaining a credit card after bankruptcy is possible, the consequences if you are unable to keep up with payments can be very severe, so whether or not you should get a credit card after bankruptcy is going to depend on your situation and your ability to pay on time. - 23222
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Now go see Mortgage Loans After Bankruptcy and or read our blog to read more about the Types Of Bankruptcy
posted by X - Men @ 4:51 AM
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