Credit after bankruptcy is destroyed. Don't believe the hype.

[AMISLANDER]

I have established 3 new credit lines since my discharge in March. I got CreditOne for $200, Kay Jewelers for $2000 and Jared for $2000. I am going to establish these positive accounts and raise my scores and then apply for one or two more in about 6-9 months. My ultimate goal is to get my scores to 620+ and buy a house in 2011/2012.

I had horrible credit before my BK. Tons of charge offs and collections. Plus a repo with a large definciency balance. I did (and still do) have student loans reporting positively.

Two of your credit cards are jewelry stores? You would do better with a Shell or BP card that will at least reward you for using it; jewlery credit cards would seem like the last type of card to acquire.

[Nick9075]

Well in my case, my credit can't get much worse so the 'effect' on my credit by filing for bankruptcy is a moot point.

At this point WITHOUT a bankruptcy on my record, I cannot even get a $5,000 car loan at 21% interest WITH $10,000 down. I have literally been laughed at by car dealers telling me that they 'can't remember' the last time that someone with my income who was putting down a substantial down payment couldn't get a loan at any rate.

But you don't need more unsecured credit after bankruptcy. This is the way I think of it---- How much money am I throwing out the door even money to credit card companies where the balance is not getting reduced. Under the worst chapter 13 plan I will likely be paying just over $1,000 a month and can actually SAVE $1,000 a month instead of having to reach for the credit card.

Question is what about transactions where they run your credit but you aren't applying for credit and can still be denied such as with apartment rentals where they use a different 'scoring method' that takes an aggregate of credit & other 'factors' (whatever they are), opening a checking account (credit is checked even if you never bounced a check or were assesed any type of OD fee), renting a car (credit is checked as well and you can be in for a rude awakening at the rental counter).

[Nick9075]

You've got people with perfect credit who are looked at like nobodies right now due to the credit "crisis" in this country. Do you honestly think someone with a bankruptcy on their record is going to be looked at as stellar?

Sorry, but being treated "poorly" is a small price to pay for getting rid of your previous debt. If you don't need the credit, it shouldn't affect you how you're being "treated".

I plan on really not getting any "normal" credit for the next 10 years. My husband and I each have a Capital One, Best Buy, Target, Orchard Bank and Hooters. Next year, we plan on applying with our CU for one of their cards (b/c we have to wait 2 years since discharge), but that's about it for us as far as "normal" credit goes.

I won't die if I never have a Discover card again or a US Bank. It's a good feeling to know that if all of our current cards are maxed out right now, I will only be a few thousand dollars in debt...not $60K like I once was.

You've got people with perfect credit who are looked at like nobodies right now due to the credit "crisis" in this country?? Really are you sure about this?? The 'credit crisis' at this point in time is a manufactured soundbite from the media. If you have a decent income and a FICO in the 700's you can find deals on everything from 0% credit cards, new cars at 0% for 72 months and being able to buy multiple homes for primary residence & investment property.

The REAL issue with credit is debt/income ratio. Back in the 'day' (maybe 18 months ago) when I was current on all my cards had a decent but not great FICO score of around 645 I was still getting denied for every card I applied for because of very high debt/limit ratio or now as car dealers are telling me -- your debt/income ratio will scare any lender away. They can give me a 21% loan with 70% down if I could get my debt ratio down.
I predict in my case after filing for chap 13, I will be in a much better position to obtain credit as well as be able to save at least $1,000 a month

[jennordhavn]

Two of your credit cards are jewelry stores? You would do better with a Shell or BP card that will at least reward you for using it; jewlery credit cards would seem like the last type of card to acquire.

I couldn't get a gas card, I tried. I only got the second jewelry card to help with utilization. I don't plan to use it. I had no revolving cards after my BK, now I have 3 and have about 10% utilization.

[Moms4Boys]

I am not sure how people are getting approved for $1000 unsecured credit cards after bankruptcy. Someone posted yesterday how they applied for multiple cards and were denied. I am in the exact same boat. I fixed my credit reports to be correct, but I believe the fourth secret agency Innovis could be causing the denials. Anyways, I gave up my house, my car, everything, and now I am unable to get any unsecured credit, even with a bad credit company like First Premier. Bankruptcy is not relief, but a complete disaster. I am just putting this out there for people who are not gettting credit after bankruptcy. Don't believe the hype of the people who somehow got $1,000 credit approvals. They are most likely the minority.

Hi Moneytrouble:

I am in your boat exactly. I just applied for a Credit One card and was approved. I am not sure of the amounts, but I can let you know when I find out. I also just purchased a 2005 Nissan Pathfinder with $2k down. Of course the interest in 21% but I will refinance through my credit union in 6-9 months. My payments are about $433 a month.

So you can get some credit somewhere, just have to invesitgate before you do it. My report is completely cleaned up and now there is nothing on (well no debt anyway). It is going to be along haul, but I have faith now, everything is starting to fall in place.

Good luck with your journeys, keep your head up and have faith, thats when things turned around for me!!

[OregonMom]

My question is this, why are you so concerned about a credit card in the first place? They were my down fall and I have no intentions of getting another one. I purchased a used car to build my credit and may look at financing something else later on to build credit, but never again a credit card.

[jennordhavn]

My question is this, why are you so concerned about a credit card in the first place? They were my down fall and I have no intentions of getting another one. I purchased a used car to build my credit and may look at financing something else later on to build credit, but never again a credit card.

I'm not sure if you were asking me or not, but if so, here is my answer:

I am not necessarily concerned with getting credit cards. I have lived for 4+ years without them. My goal is to buy a house by the summer of 2011. I have never owned a home before. The best way to build my credit (besides cleaning up my reports) is to reestablish some positive history. I need my scores to be 620+. Once I obtain a mortgage, I could really care less whether I have a credit card or not. I don't need a car right now so I don't want to get a car loan. I have student loans reporting positively which is helping, but I also needed some revolving accounts.

[trying_to_fix]

Just thought I'd add my experiences here...

I discharged with Chapter 7 in March so in April I began my quest for rebuilding.

During that time here is the credit I've received:

Credit One - $1500 limit
Orchard Bank - $500 limit
Show Mastercard - $1500 limit
Legacy Visa - $250 limit

All of these were applied for during March and April. Before I filed my credit was in the dumps with scores in the 500s. Now I'm in the mid 600s so things have definitely worked in my favor here.

As for these credit cards, I've been paying them off in full every month so I have only good experiences with them. Although I am charged fees for most of them (except the Orchard Bank) I figure that is a small price to pay to rebuild my credit.

Also since then I've gotten a vehicle loan and still continue to pay on student loans. My income is in the lower $100k range so I don't know if that had anything to do with these successes.

[AMISLANDER]

I couldn't get a gas card, I tried. I only got the second jewelry card to help with utilization. I don't plan to use it. I had no revolving cards after my BK, now I have 3 and have about 10% utilization.

You'd do much better to get a Hooter's card; they're bk friendly..and pay the balance in full for six months...

[AMISLANDER]

I'm not sure if you were asking me or not, but if so, here is my answer:

I am not necessarily concerned with getting credit cards. I have lived for 4+ years without them. My goal is to buy a house by the summer of 2011. I have never owned a home before. The best way to build my credit (besides cleaning up my reports) is to reestablish some positive history. I need my scores to be 620+. Once I obtain a mortgage, I could really care less whether I have a credit card or not. I don't need a car right now so I don't want to get a car loan. I have student loans reporting positively which is helping, but I also needed some revolving accounts.

If you don't make use of your accounts, you're not raising your scores; hence, why jewelry?

[AMISLANDER]

Just thought I'd add my experiences here...

I discharged with Chapter 7 in March so in April I began my quest for rebuilding.

During that time here is the credit I've received:

Credit One - $1500 limit
Orchard Bank - $500 limit
Show Mastercard - $1500 limit
Legacy Visa - $250 limit

All of these were applied for during March and April. Before I filed my credit was in the dumps with scores in the 500s. Now I'm in the mid 600s so things have definitely worked in my favor here.

As for these credit cards, I've been paying them off in full every month so I have only good experiences with them. Although I am charged fees for most of them (except the Orchard Bank) I figure that is a small price to pay to rebuild my credit.

Also since then I've gotten a vehicle loan and still continue to pay on student loans. My income is in the lower $100k range so I don't know if that had anything to do with these successes.

Income & pre-bankruptcy score do help.

[jennordhavn]

If you don't make use of your accounts, you're not raising your scores; hence, why jewelry?

Actually, it does raise my scores by helping my utilization. I have $4250 available credit and only have about $600 used right now. That is better than having $2250 and $600 used. I really don't see why you keep harping on my having jewelry cards. It doesn't affect you. I am able to manage my credit after my BK. I am sharing my experiences with rebuilding to help others that are trying to rebuild. It doesn't mean I advocate the use of jewelry credit cards. To each his own. I am sure once my credit begins improving I will be able to obtain better cards...such as gas cards and Hooters. However, if I choose to have 5 jewelry cards it's really none of your concern.

[eddiep]

great tip on utilization, I have to admit I would not have thought of that.

[AMISLANDER]

Actually, it does raise my scores by helping my utilization. I have $4250 available credit and only have about $600 used right now. That is better than having $2250 and $600 used. I really don't see why you keep harping on my having jewelry cards. It doesn't affect you. I am able to manage my credit after my BK. I am sharing my experiences with rebuilding to help others that are trying to rebuild. It doesn't mean I advocate the use of jewelry credit cards. To each his own. I am sure once my credit begins improving I will be able to obtain better cards...such as gas cards and Hooters. However, if I choose to have 5 jewelry cards it's really none of your concern.

Don't take it personally, this is just a board for opinions on rebuilding credit.