I thought rebuilding was going to be impossible

[Jeffster]

My Chapter 13 was discharged in January 2021. 100 percent plan which I completed 1.5 years early.

I wasn’t quite sure how I was going to rebuild my credit, and was kind of OK with just sticking to my debit cards. In fact, I had resigned myself to a future using debit cards only.

I decided to give Cap One a try anyway a few days after my discharge. I had a Cap One IIB but, again, I had a 100 percent plan. I still wasn’t expecting an approval. I was instantly approved for a Cap One Platinum with a $3,000 limit.

The same week, I received a pre-approved invitation for the Ollo MC. Instant approval for $1,800.

Since then, I have been approved for:

B of A Cash Rewards Visa (Secured) $5,000
TD Cash Rewards Visa (Secured) $1,500
Jasper MC $5,000
Mercury MC $2,500
Merrick Double-Your-Line Visa $1,000

Add those to the aforementioned:

Cap One Platinum MC $3,000
Ollo MC $1,800

I’ve been keeping utilization at around 1 percent, charging and then paying off. My go-to card is the BofA...really good rewards. If you have an existing relationship with BofA, it’s a great card.

I’ll now wait for these cards to age a bit...and the secured cards to graduate...before maybe applying for another Cap One, or something else.

My scores right now on (real) FICO are:

EX 650
EQ 659
TU 658

Thank you to all for the great advice on this board.

[justbroke]

Excellent. Life after bankruptcy is entirely possible if we keep our finances in order. You should probably garden at this point. (To garden is to stop applying for credit for at least 6-12 months.) You did very well. Your scores will likely be even higher in the next 6 months.

[shipo]

I’ve been keeping utilization at around 1 percent, charging and then paying off. My go-to card is the BofA...really good rewards. If you have an existing relationship with BofA, it’s a great card.

Wow, my experience was exactly opposite of yours. Last year following my Chapter 13 discharge I applied for a BofA secured card (I'd been a banking customer of theirs for many years at that point); they denied me because "I was either about to file for bankruptcy, or in an active bankruptcy". I appealed and sent them proof of my discharge; they denied me a second time.

I promptly closed all of my banking accounts with BofA and walked them across the street (literally) to TDBank; they were more than happy to open the accounts AND give me a secured TDCash card with a $5,000 limit. Better still, the secured version of the TDCash card graduates very quickly, especially compared to the BofA card; mine graduated to unsecured exactly six months after my first charge.

[Barbisi]

Jeffster, jb and shipo, this leads me to a very important question: If the debtor can not payback 100% of the approved claims (as Jeffster did) does that mean obtaining one or two CCs soon after discharge is much more difficult and will take 6 months to a year to achieve?
We will be able to repay probably less than 35% of the total owed -is that an automatic target on your back that you are a bad credit risk?
We may need some credit to move out of state for airplane trips to find housing, car rental and hotels. We need to start planning now. When we are allowed to sell the house we should have more than enough to pay for everything only with debit cards if we had to. We are just not sure what to expect with a fresh closed discharge.

[flashoflight]

Jeffster, jb and shipo, this leads me to a very important question: If the debtor can not payback 100% of the approved claims (as Jeffster did) does that mean obtaining one or two CCs soon after discharge is much more difficult and will take 6 months to a year to achieve?
We will be able to repay probably less than 35% of the total owed -is that an automatic target on your back that you are a bad credit risk?
We may need some credit to move out of state for airplane trips to find housing, car rental and hotels. We need to start planning now. When we are allowed to sell the house we should have more than enough to pay for everything only with debit cards if we had to. We are just not sure what to expect with a fresh closed discharge.

I am in a <1% plan, burned all of the big banks' credit cards, and am still able to get new credit cards while in the chapter 13. I don't have to wait until discharge The first card was received 6 months after the filing. My trustee has a rule not to incur more than $1k in debt while in bankruptcy without court permission unless it is an emergency, and I liberally interpreted that to mean not to carry a balance more than $1k rather than $1k in credit limits. So there should be no problems rebuilding credit whether you do it shortly after filing or after discharge.

[shipo]

Jeffster, jb and shipo, this leads me to a very important question: If the debtor can not payback 100% of the approved claims (as Jeffster did) does that mean obtaining one or two CCs soon after discharge is much more difficult and will take 6 months to a year to achieve?
We will be able to repay probably less than 35% of the total owed -is that an automatic target on your back that you are a bad credit risk?
We may need some credit to move out of state for airplane trips to find housing, car rental and hotels. We need to start planning now. When we are allowed to sell the house we should have more than enough to pay for everything only with debit cards if we had to. We are just not sure what to expect with a fresh closed discharge.

No, I don't think one has anything to do with the other. It took me so long to get three credit cards because I screwed up right after my discharge. Screwed up how? I was in too much of a hurry to do my homework properly and ended up with a whopping seven hard pulls against my credit reports within six weeks, and all I had to show for those pulls was denials and one secured credit card with a measly $1,000 credit limit. If I knew then what I know now, I could probably have ended up with an easy $8,000 in available credit (mixed between secured and unsecured) within four or five months of my discharge.

Fortunately, time heals these types of self inflicted wounds; by this time next year I'll have zero hard pulls in the previous twelve months, and only four within the previous two years (keep in mind, hard pulls over a year old do not factor in FICO scoring). Next summer will be decision time for us, buy a new house (much of this decision will be based upon where our kids will be living at the time), or maybe splurge and buy a couple of new cars. Regardless, my credit scores will be well set up for either option.

[Carmella]

flashoflight that is something I wondered about since my husband and I are allowed $500 each of debt (not sure if that's the correct term) without approval. I have thought about applying for credit card and not charging over $500 and actually using the card very little. Maybe just to put gas in the car and pay it off monthly. But I don't know if' the limit would matter vs how much was actually charged and never went out of my way to ask.

I have used the online services that let you buy something in 4 installments just because it was offered and easier to manage. And the things I bought were around $200.

Barbisi about Debit Card use. Sometimes places will put a hold on your Debit card for an amount LARGER than what you are spending. That could mess up your cash flow. We have two bank accounts/different banks. One puts a hold on gasoline so I tried purchase $20 of gas and got denied use because my balance in the checking account is under $100. Yes, they put a $100 hold on my debit card when I buy gas. I found that out when I had $98 in the account and was denied use. My other bank does not do that and they will even not penalize you if you get into a negative balance and then transfer money over within 24 hours. I found that out because we have two checking accounts at that bank. One is used for paying automatic payments we transfer money to it so it often gets a very low balance. I put in the wrong amount once and it went negative, but the payment was still paid and I could transfer the money over as I have cell phone notifications if anything happens to that account like a low balance (under $50).

[flashoflight]

Carmella I leave a $10 balance on one credit card. I pay the card off prior to statement date so nobody can say we incurred debt when looking at the credit report. I have to admit I run the card a lot for utility bills due to the cashback rewards. We run the household expenses mostly cash only or debit cards just like everyone else in chapter 13. I usually buy gas with cash at Arco or use the credit card because I'm afraid of getting skimmed. Our debit cards are through Fidelity investments due to their lack of fees even if you go negative due to a gas pump hold. Because negative balances are ok, I never allow the brokerage account to fund the debit card (the CMA account) automatically in case of theft or errors.

[Barbisi]

Carmella, our planning for exclusive debit card use is only after BK13 ends and hopefully we have the house sale proceeds in the bank - then if they charge three or four times what the air fare , car rental, hotel room costs, the money will be there as needed!
Nonetheless, some people are very lucky and can get necessary credit soon after their BK13 discharge and closing - so at least there is hope!
Our situation is as jb once said "too fluid" so maybe everybody in Colorado is right, "we'll have to die here after all !" (meaning we won't be able to leave Colorado ever.)

[justbroke]

Barbisi you are always welcome here in Heaven's Waiting Room (a/k/a Florida).

[Barbisi]

Thanks jb- you always know what to say!
Actually, I was just venting - Colorado is off to another brutal summer of near record breaking 95 (or above ) degree days with no precipitation that will soon turn everything an ugly brown. I am so sick of every baking hot summer followed by frigid icy and snowy winters and little mild temperatures in between.
When I complain about these rapid changes, these clueless Colorado lovers simply say "Go to the mountains! Colorado is the greatest place on earth! Start taking CBD oil and smoke pot!"
Unfortunately, my body doesn't love the arid altitude and the hourly barometric shifts and my PT and chiro visits are through the roof cost wise (around $500 monthly) so I can remain upright and mobile. My neck locks up frequently and becomes painful to turn side to side and my mid and low back needs cupping, Graston, ART and dry needling so I can work out and keep moving.
Today was a rare mild day - only around 82! (A weak "cold" front went through.) Tomorrow though, the blistering sun and unblissful heat return for another lengthy stretch.
The trouble with Florida would be the terribly humid, sunny and hot (above 90) summers. Your winters are nicer I know but I need milder summers too.
Washington is much less sunny and rainier (which I love!) and mild (30s to 50s ) in winter and only 70- 80 ish in summer, which honestly sounds heavenly compared to the barometric pressure hell that is Colorado year round.
I've got to get out of here one way or another and hopefully we can make it happen in 2022!

[Carmella]

Barbisi Thought of you today and this is totally off topic. Someone I know as an acquaintance who is around 30 yrs old just left Colorado. They moved for a job. They had nothing but problems. She also speaks of uppity rude people. She also had a link with pictures of a small not very attractive 3 bedroom home selling for 1.2 mil

Just thought of you to say, certainly not everyone likes it there and it's good they got out while the getting was good. After about 6 months, guess they won't be complaining as much about boring old Ohio.

[Barbisi]

Carmella, I couldn't agree more with the Colorado assessment of your acquaintance. And they weren't even in BK13-imagine how much worse their lives could have been!
Loads of overpriced, underwhelming homes abound here as do very affluent, arrogant and entitled people who have no empathy or respect for others.The super dry hot/snowy high altitude climate is also just about the worst I've lived in -I seriously can't wait for moving day!
I think Ohio's winters would be too cold for me , but I'm sure the summers are better than here (It's supposed to be 100 each day til maybe Friday.)
When you speak of these folks complaining about Ohio, it sounds like they moved to Colorado from there and just returned home . And if they sold their house for 1.2 million, they made a killing. We won't be able to get anywhere near that much,but it's bound to be better than the proceeds from the last investor shack which led directly to BK13. At any rate ,we won't belittle however much we manage to clear in the sale - as long as we can get out too!

[Jeffster]

Now that I know that rebuilding really is possible, I’m in it for the long game.

I will now let these cards age. I have more than enough credit to suit my needs now, and far more than I ever expected to get so shortly after my discharge. My total reliance on my debit card during the Chapter 13 taught me well that if I don’t have the cash for something, I probably don’t need it. I do put my BofA Visa to good use every month, and PIF. The other cards see casual use just to show activity.

The credit union serving my employer cancelled my membership when I filed. After some recent snafus on their part after discharge when it came to reporting and other issues, they have now corrected those issues and have invited me back. I’m still wavering on whether to go back to them.

I also joined two local credit unions, and am planning on building a relationship with them.

I was a long-time Wells Fargo customer, and even though I included my WF card in the Chapter 13, they didn’t cancel my checking or savings. In case they did, I opened checking and savings at BofA prior to the filing. BofA was so good to me during this time, as well as after discharge, they are now my go-to bank. I am really racking up the rewards with them.

I included Penfed and USAA in my Chapter 13, and neither canceled my membership. I know it would be a long time...if ever...before they would approve me for credit, but I’ll keep those open to keep a possible relationship going.

Neither my Jasper, Mercury nor Merrick have annual fees. The only card with an annual fee ($29) is my TD Cash Visa, and I am hoping that it graduates quickly to an unsecured, annual fee-free card.

[shipo]

Neither my Jasper, Mercury nor Merrick have annual fees. The only card with an annual fee ($29) is my TD Cash Visa, and I am hoping that it graduates quickly to an unsecured, annual fee-free card.

Yeah, like I wrote above, my TDCash card graduated exactly six months to the day after my first charge; that said, I did put a reasonable amount of spend on the card in that period. Looking at my statements, it looks like I charged an average of $2,000 per month and paid the account in full before every due date (meaning my statements typically showed a few late clearing charges and nothing more).