Have we not learned....

[mountanddo]

Maybe I was a bit harsh, but I don't see how getting a $300 limit credit card from some subprime CC company will impress a lender, I would be more impressed by someone who had not jumped right back on the credit card train.

Well, if I was asking YOU for credit then I guess it would be you that I would want to impress. The fact of the matter is that having a CC and paying it off and using it wisely DOES impress creditors and that is just a fact. If you don't jump back on the credit card train and establish credit you are going to have a hard time when you need a loan for a car or a house. Reality is that you are not trying to impress "people"... you are up against computer numbers that determine whether you are credit worthy or not.

[IBroke]

Maybe I was a bit harsh, but I don't see how getting a $300 limit credit card from some subprime CC company will impress a lender, I would be more impressed by someone who had not jumped right back on the credit card train.

Unfortunately, that's far off reality. In our days - and especially to get to the point where a creditor will actually take the time to look at your credit in person - you have to have a certain credit-score. FICO considers credit-utilization when your score is calculated - and not the "impressive" amount of credit you have (I could even argue to somebody with a high CL is a greater risk than the guy with a $300 CL because "overextending" can become an issue at some point. With $300 - not so much).

My mother had to have a 680 credit-score to get her mortgage. Since we moved here from another country, we didn't have a long credit-history. We obtained the mortgage by having a CC with a $300 limit and a reported balance of $6. That pushed her over the required score. Without that tiny card - mortgage denied. That's simply how it works.

You can certainly make the argument that for yourself, you will never want to have car-loans or CCs any more. Point taken. But thinking that this personal choice would get you an advantage in the lending-industry is like trying to draw a circle with edges. That industry has its own rules.

[tradinglife]

Unfortunately, that's far off reality. In our days - and especially to get to the point where a creditor will actually take the time to look at your credit in person - you have to have a certain credit-score. FICO considers credit-utilization when your score is calculated - and not the "impressive" amount of credit you have (I could even argue to somebody with a high CL is a greater risk than the guy with a $300 CL because "overextending" can become an issue at some point. With $300 - not so much).

My mother had to have a 680 credit-score to get her mortgage. Since we moved here from another country, we didn't have a long credit-history. We obtained the mortgage by having a CC with a $300 limit and a reported balance of $6. That pushed her over the required score. Without that tiny card - mortgage denied. That's simply how it works.

You can certainly make the argument that for yourself, you will never want to have car-loans or CCs any more. Point taken. But thinking that this personal choice would get you an advantage in the lending-industry is like trying to draw a circle with edges. That industry has its own rules.

Agreed, you will get your score up quicker with cards, however many people who get cards to "rebuild their credit" will end up rebuilding their pile of debt. As another poster said not everyone can handle credit cards responsibly. I feel like at this point I could, just don't want to.

[IBroke]

Agreed, you will get your score up quicker with cards, however many people who get cards to "rebuild their credit" will end up rebuilding their pile of debt. As another poster said not everyone can handle credit cards responsibly. I feel like at this point I could, just don't want to.

That's certainly true. I discharged about $250K in CC-debt. That might be the reason why I wouldn't consider these small CCs to be a "threat". Right now, I'm having a total of 6 CCs with a combined CL of $3,300. $1,000 of that are secured and two of these six cards survived my bankruptcy (I paid them off prior to filing - I could because the CLs were that low). The biggest CL ($1,000) was obtained at a car-dealership to pay for a repair on my old ride. I paid off the $900-bill over 6 months - interest free. My current car is CPO'ed so I won't be using that card again. I doubt I'm going to have the urge to go on a shopping-spree at the parts-department of my local Ford-dealer - and that's the only place where this card can be used.

None of my cards has a monthly payment higher than $35.

I won't obtain any additional cards and if I'm going to ask for a higher CL on one of these cards, it is going to be by making another deposit on my Capital One card which is secured.

This month, I'm going to have all my cards (except one) report a $0-Balance in order to refinance my auto-loan beginning of March.

[doni49]

Maybe I was a bit harsh, but I don't see how getting a $300 limit credit card from some subprime CC company will impress a lender, I would be more impressed by someone who had not jumped right back on the credit card train.

I would not be so quick to think that. If you were a potential lender and saw that your applicant had gotten a CC with a small limit and then had a high balance of say ONE THIRD of the limit or maybe even less, wouldn't you think that the person had in fact learned his/her lesson? I believe I would be inclined to think so.

[Flamingo]

I would not be so quick to think that. If you were a potential lender and saw that your applicant had gotten a CC with a small limit and then had a high balance of say ONE THIRD of the limit or maybe even less, wouldn't you think that the person had in fact learned his/her lesson? I believe I would be inclined to think so.

Someone a year or so out of BK with only one or two cards and handling them prudently would be looked upon as a better risk that someone with multiple cards with low limits that could all ultimately be maxed out or maxed out if/when credit limits are raised. Much more is looked at when there is a BK sitting on credit reports for 7 to 10 years besides active cards and credit scores. In fact, one can have a credit score well over 800 and be denied credit as there are lenders out that that will never extend credit to you again if you have included them in your filing or a department store associated wiith them in your filing. I had a credit score of 836 in December 2011 and was denied credit for a car purchase by one bank who indicated the reason as having had previously discharged debt with the bank. A bankruptcy never really goes away.

[tobee43]

Someone a year or so out of BK with only one or two cards and handling them prudently would be looked upon as a better risk that someone with multiple cards with low limits that could all ultimately be maxed out or maxed out if/when credit limits are raised. Much more is looked at when there is a BK sitting on credit reports for 7 to 10 years besides active cards and credit scores. In fact, one can have a credit score well over 800 and be denied credit as there are lenders out that that will never extend credit to you again if you have included them in your filing or a department store associated wiith them in your filing. I had a credit score of 836 in December 2011 and was denied credit for a car purchase by one bank who indicated the reason as having had previously discharged debt with the bank. A bankruptcy never really goes away.

this is so true. really the only thing that helps is time. it's a sad day when a score of 836 can't get one a decent interest rate for a car loan.

we had 3 cards to rebuild but closed one since it was reporting regularly to the credit agencies. we also have excellent scores, but i'm certain we would fall into the same situation if we were to apply for any large amount of money. with that bk sitting on there, many creditors simply do not want to take a chance. which actually, makes no sense since one cannot file bk anytime soon, one would think that's a safer risk than many.

[artgood]

I doubt that anybody would obtain a CC with a $300 limit to buy something that he/she couldn't afford. That just complete nonsense.

I didn't apply for a CC so that I could buy something, but rather to begin to rebuild my credit. I am never going to make enough money to buy a house outright - I will have to have a mortgage someday if I want to eventually own my own home. As a pastor, I will have very little (if any) retirement assets apart from Social Security, and hopefully a house that I own free in clear

[SweetGeorgia]

I'm actually much more leery of a mortgage loan than a credit card (not that I'm likely to get either anytime soon!). The mortgage - well, I just think there is a 100% chance of being screwed one way or the other. Really. There are nonsense closing costs, and nonsense fees, and forced insurance, and... I could go on, but the point is that you pay or you lose your house. I don't have a solution for this, yet!

I haven't applied for a credit card because I don't have a job and I did incur new medical debt last year which took 6 months to pay off - sinking my lovely post-discharge FICO! I haven't used a CC in more than 3 years - and I cannot even force myself to use gift cards I've received. And honestly, shopping was never my problem; I ran my cards up several times and paid them off but it was mostly business.

Still, I wish I had a credit card. I didn't get to see my grandmother before she died last fall, and I couldn't go to the funeral. THAT is why I wanted a credit card. (I got a tax refund 3 weeks later which was more than enough to pay for it. Which just makes it worse.)

[BankruptinNJ]

[QUOTE=IBroke;560097]"To buy something"? Who made that claim?

I doubt that anybody would obtain a CC with a $300 limit to buy something that he/she couldn't afford. That just complete nonsense.




I'm guilty of this I saw credit cards as a way of acquiring things I couldn't afford. Oh, well. It's part of being a shopaholic.

Haven't had a new credit card in about 5 years.

[IBroke]

I'm guilty of this I saw credit cards as a way of acquiring things I couldn't afford. Oh, well. It's part of being a shopaholic.

Haven't had a new credit card in about 5 years.

Oh, I wasn't talking about CCs in general. I was talking about CCs with a low limit ($300). Some of these sub-prime cards don't even have their entire CL available once they are issued. I think my Plains (now Mid-America) VISA had less than $60 available at the beginning - the rest of the $300 CL was sucked up by initial fees.

I purchased things with CCs I couldn't afford as well - but when I obtained these cards with low limits, spending wasn't on my mind.

That's why my cards with the two small limits survived my BK and my "overspenders" like Chase or Discover didn't.

[HHM]

however in today's world, it is almost a necessity to have a credit card to travel, rent a car or stay in a hotel

That is the slippery slope premise that I absolutely disagree with. Tradinglife has a point, those that do post on this forum about getting credit after BK have a deeper issue, they harbor FALSE assumptions about why they "need" credit. Personally, it is highly unlikely that these people will find themselves in BK again (although statistically, those that file BK once are more likely to file again relative to the population as a whole) so I don't take the argument as far as tardinglife, but it is a real risk. Once you start using credit, it is not that hard to start accumulating balances, and the credit becomes the safety net and not savings, then you buy a house, and has MOST people do, they tend to buy more house then they can really afford, and 20 or 30 years from now, the next housing bubble, they will be filing BK again to get out from an underwater house and lingering credit cards used to stay afloat during the next great recession.

You really don't need to "proactively" get credit, Just make sure your credit report is accurate, and let time do its thing.

[AngelinaCatHub]

In agreement with HHM, we have been discharged for going near 4 years. We have not applied or even looked at our credit scores. We have a debit card that quits when out of money. We both carry a C note in wallet as "insurance". (hidden and forgotten). So, in visitation of my CU of 45 years and as an old member, one of the officers in our conversation asked would we like to have a free credit report on them? So I did and we are 680 doing NOTHING to improve such. Before bk we were 820 and spent freely. Once broke, we learned and I could care less if my score is 820 or 300. I use only my money. It is called FREEDOM. I do not owe my soul "to the company store". 'Hub

[Diesel73L]

All I have to say is that I'd rather have credit and not need it than need it and not have it.

[Logan]

In agreement with HHM, we have been discharged for going near 4 years. We have not applied or even looked at our credit scores. We have a debit card that quits when out of money. We both carry a C note in wallet as "insurance". (hidden and forgotten). So, in visitation of my CU of 45 years and as an old member, one of the officers in our conversation asked would we like to have a free credit report on them? So I did and we are 680 doing NOTHING to improve such. Before bk we were 820 and spent freely. Once broke, we learned and I could care less if my score is 820 or 300. I use only my money. It is called FREEDOM. I do not owe my soul "to the company store". 'Hub

Do you guys own a home?