Corporate Credit Card and Chapter 13

[TrackDog]

I'm getting ready to file a Chapter 13. My wife is military and has a government credit card. I am a contractor and have a credit card issued for business purchases. Is there anything I can do to keep these after I file? Thank you!

[lrprn]

Whether you can keep the credit cards or not depends on two things:

1. Are the cards in your names or your employers? If they are in your employers' names and your employer is responsible for paying the balance if you don't, then the cc's aren't your debt and therefore don't have to be listed when you file.

2. If the cards are in your names, can you ensure the balance on both cc's is zero on filing day? If yes, then you don't have to list the cards because you don't owe any debt on them.

Here's the bad news.....the major cc's trade information between them. If one cc finds out you filed, even if you don't list these specific two cc's, the cc lenders may decide to cancel your cards anyway. Start planning ahead now for what you'll do if you end up losing one or both cards.

Do talk with your lawyer about this situation. I have a corporate credit card with my name on it that had a zero balance on filing day - the #2 situation I described above. I talked with our lawyer about it and he recommended I call the lender directly before we filed and ask to speak to their 'late payment/bankruptcy" manager. I did and after a careful review of my card payment history, he said that since I had never had a late payment and was only using the card for legitimate business expenses I would be allowed to keep the corporate charge card. He also said that as long as the charges continued to be for business only, they would leave the card alone and review things on an annual basis. That was 4 1/2 years ago - I've been very careful to use the card only for business and made all my payments on time. I'm happy to say that my card has been renewed twice since we filed.

So it is possible to keep one or both cards if you plan ahead, get good advice from your lawyer about what to do, and frankly, are both as lucky as I was.

[Flamingo]

Do a search in this forum on your subject matter - there are many threads about this subject. It all depends on how your corporate card is set up as explained above by lrprn. Many are based on the applicant's credit but issued through their employer. Others are cards in the employer' name allowing the employee as an authorized user. If the card is in your name and was based on your credit, and you file (same for your wife if the BK is joint), the odds are high your card will be cancelled out when the creditor learns of your filing even if you had a zero balance at filing. If you require this card for business travel and use it a lot, it's best to speak with HR or your employer as to a back up plan just in case the card is cancelled.

[woeisme]

I was issued a company credit card after I filed CH 13, it wasn't an issue since the company is legally responsible for the payments, not me. But also means it's not helping me build a better credit rating either, but with almost 2 years left on my 13, not a big deal at this point. But as others said above, I think it depends on who pays the bills, if it's you, you will probably lose the card. That's great that lrprn didn't, hadn't ever heard of that happening before.

[RunningMan]

I have both a business Amex guaranteed by me and corporate Amex that is issued to me by my employer, but the bill is paid by me and they reimburse me. I filed about a month and a half ago and neither has been cancelled yet. My wife has had a Visa cancelled that had a zero balance when we filed. My business travel runs about $3000-$7000 a month depending on the month, so it would be painful to lose the corporate card but I am prepaired to get a secured credit card if necessary.

[TrackDog]

Did you call the business CC companies to let them know you were filing? The card is through the company I work for and is in my name. It is only used for business and I pay the bill as soon as the company re-imburses me after I file my travel claim. I think I am more stressed out about losing this card than anything else. It would make my job difficult and be very embarrasing if I were to lose it. I was debating whether or not to call the number and inquire about what would happen. I'm worried that if I call, they will cancel it because I am going to file.

[chicagoannie]

I have both a business Amex guaranteed by me and corporate Amex that is issued to me by my employer, but the bill is paid by me and they reimburse me. I filed about a month and a half ago and neither has been cancelled yet. My wife has had a Visa cancelled that had a zero balance when we filed. My business travel runs about $3000-$7000 a month depending on the month, so it would be painful to lose the corporate card but I am prepaired to get a secured credit card if necessary.

RunningMan - is there a limit to limits on secured cards? When I traveled for work, my expenses were around $5K/month.

[RunningMan]

I think the limit on a secured card is whatever you put in their account to secure the card with. The most I could do right now is $5000. That is usually enough unless I have to travel internationally. I would have to be very diligent on turning my expense reports around quickly.

[Flamingo]

Did you call the business CC companies to let them know you were filing? The card is through the company I work for and is in my name. It is only used for business and I pay the bill as soon as the company re-imburses me after I file my travel claim. I think I am more stressed out about losing this card than anything else. It would make my job difficult and be very embarrasing if I were to lose it. I was debating whether or not to call the number and inquire about what would happen. I'm worried that if I call, they will cancel it because I am going to file.

Also, if you have an employment contract check it to see if there is a clause that requires you to inform your company if you file bankruptcy. Many management and higher positions have a clause of that nature in their employment contract. Since your card was requested for you by your employer but utilized your social security number and credit, you may have to check with your employer as to your situation depending upon your company policy as to your business/corporate card. Your company should have a travel/expense policy as to all this which should include information on corporate credit cards for travel.