How Soon After Chapter 7 Bankruptcy Can You Get a Credit Card?

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Chapter seven bankruptcy is the most common form of bankruptcy that is used in the world today. It is the type of bankruptcy that liquidates your business or assets to allow them to be used to pay the people that you owe money to that you cannot pay back yourself. This liquidation happens all too often in our atmosphere of misused credit today.

There are several small steps you can take to get back on your feet after bankruptcy. However, most of these methods take time, because it is impossible to be instantly qualified for credit and back on track right after you have claimed that you cannot pay off your debt. Having credit card companies, banks, and other lenders trust you with credit again is going to take some time.

Build Your Credit Score

The best thing you can do to qualify yourself for good credit, better interest rates, and descent credit limits again is to build your credit score. Unfortunately, the only way you can really do this is to use some form of credit, like credit cards. So at first it may be difficult to pay those high interest rates and have such low credit limits, but you must face the consequences of filing for chapter seven bankruptcy and pay the price until you are back on your feet. Once you have again established a good credit rating, you will have lower interest rates and higher limits because you have rebuilt your trust and lowered your risk of another bankruptcy.

Manage Your Credit Wisely

The fact that you had to file for chapter seven bankruptcy alone should be a lifelong lesson that will get you to be more careful about your spending habits and your payment abilities. Now that you are trying to move on, you should create a budget for yourself so that you know just how much you can spend on credit, how easily you will be able to make the monthly payments on that amount, and how many things you could go without so that you can gain a better credit score.

Getting Another Credit Card

Getting a credit card after you have filed for bankruptcy will not be difficult. You will still receive offers and qualify for several different kinds of cards. In fact, if it is used more wisely than it was prior to your bankruptcy, a credit card may be the very thing that gets you out of your slump.

Having a credit card and using it sparingly after bankruptcy will help to build your credit score and get you back to where you were. The way in which you could do this is by getting a card, only spending a small amount of money on it, and paying it off each month. Keeping your credit card account open and paying it off frequently will build your credit score more rapidly than it would if you just let your credit card debt stay at a plateau or continually increase.

Low Interest Student Credit Cards

What are the two fundmental principles of Investing 101? Risk and reward. If you’re going to put money into an investment, you have to take the potential risk and the potential reward of the investment. The riskier the investment, the higher the potential reward has to be.

Does this have anything to do with credit cards and interest rates? Of course it does. I want you to find low interest student credit cards, but I want you to understand why it’s not that simple.

Every time a credit card company extends a person a line of credit they’re factoring in the potential risk and the potential reward. You might think credit cards charge high interest rates on most student credit cards because they just want to soak the students for all their worth, but it has more to do with how likely students are to pay their credit card balances.

Interest rates are high on certain types of credit cards for one reason: the people that have been issued that type of card are more likely to flake on their payments, whether that means they pay late or they don’t pay at all. Students are a high risk demographic for credit card companies. According to the standard measurment tools (the credit bureaus), a college student is someone doesn’t have a proven track record of using their credit cards and then paying their balances. They just haven’t had access to credit cards for long enough to prove they’re a safe investment.

The reality is there are a lot of people who just can’t handle credit. They treat it like free money that won’t have to be repaid. They pay late or they don’t pay at all and the credit card company gets stuck with the bill. Most college students represent an ‘unknown quantity’ to the credit providers. Maybe they’ll behave themselves with a credit card, and maybe they won’t. Only a credit history can prove it, and college students haven’t had time to build one.

College students can get higher rate cards and use them consistently as a way of proving their credit worthiness. It may even be in their best interest to carry a small balance on the card and pay it down over time. Yeah, you pay some interest, but just look at it as the cost of doing business. If you can show the credit bureaus you’re trustworthy you’ll be able to get high limit, low interest credit cards down the road that you can use for good purposes like running a business or buying advertising.

All that being said, you may be able to find a student credit card with an interest rate between 8% and 12%. Not bad for a first timer.

Either way, if you pay your dues, you’ll get the best credit cards later.

Secured Student Credit Cards

One of the best things that any college student can do is get a credit card. There are a lot of options out there where you can go get credit cards. Some of you might have some difficult history in your past when it comes to credit. That is fine because there are still avenues for you to take a look at. One of the best ways to improve your current credit is to go get a secured student credit card.

Next you want to see what type of interest rates you can get. Usually if you have had a bad past with credit, your interest rate is going to be anywhere from 15% and up to 25%. There could be an initial lower interest rate, but make sure you read all of the terms and conditions of the contract. Be aware that there can be changes very quickly in your contract with the interest rate. It can take them only a 15 day notice before they make a change in the APR and bump it up.

Prepaid Student Credit Cards

When you get a secured credit card, you need to decide what type of credit limit you are looking to get. It usually isn’t more than a couple thousand dollars as a possibility, but more than likely a few hundred dollars. Usually the deposit will be about the same as the credit limit, but it could be less or more depending on the credit card company. It might be 50% of the credit limit or it could be up to 150%. You should search around to find a secured credit card that will allow for a smaller deposit.

With these cards, you can build a lot of credit during your younger years. You need to make some improvements to your credit and getting a secured credit card can be a great way to get you back into good graces with credit bureaus. Also with the deposit you might find yourself taking more notice and responsibility for your credit then what maybe you have done before in the past. This could also be a good option if you simply have no credit history at all. Find a lot of options before you make a decision so that you are not caught with a lot of fees and high interest rates.

Another choice you can look at is getting a family member to cosign on a line of credit to get your foot in the door, if a prepaid student credit card appears to much for you to handle. If that doesn’t work out then look to work through a debit card with a checking account and start building a good recognizable history that way.

Best Credit Card Deals For Student Credit Cards

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There are a lot of options for you to take a look at. The best credit card deals are going to depend on what you are looking for and what type of credit history that you have. Obviously the best deals are for those that have a higher credit score. If you are in the 700′s or 800′s then you are going to be just fine. I don’t think you will have to worry about high interest rates and if your credit is that high then you probably don’t even care about rates anyways because you are probably very effective in paying all of your bills on time.

So before I discuss anything about credit cards, make sure that you are willing to find out where your credit is and take a look at what you can do to improve your credit score. You can make multiple payments a month and contact any creditors that you owe to pay off debt. Then you can make sure that you have a checking and savings account open. Have a couple credit card accounts that you keep in good standing. Don’t take on a lot of other debt if you can and then it will just take time of good payments that will help you to improve your credit.

So after you have improved your credit then I would look at a major credit card issuer like Visa, MasterCard, or Discover. I have seen a lot of Orchard Bank Credit Cards for students and also a lot Capital One for people with poor credit and looking for lower limits. If you are looking for lower interest rates then I would say that Capital One is good card. A lot of cards will offer very low introductory rates. Be aware that this could change in a heartbeat. So it is important that you are able to check out the terms and conditions to see what is required from you and what obligations the company has. Many only need 15 days to notify you that they are going to change the interest rate.

I suggest that after you have figured out where your credit is, decide what is important to you. You might want a higher credit limit and you are willing to sacrifice your interest rate to get it or maybe a limit might not matter, you just want to get a good interest rate. Many of them will be around 15%. If you can find one lower then that for more than just an introductory rate then you will be doing well.

Student Major Credit Cards

The major credit cards for students can be some of the best choices and honestly will probably be the most comfortable for you. For many of you, you are just like me…sheepish. I like to go with a well known brand name because I have heard of them. I know they exist and that many people use them, so the chances of them scamming me tend to be less even though they have more customers. We all figure that they have gotten these customers because they have built a reputation with giving out good credit card offers and they don’t intend to bomb you with high interest rates, an enormous amount of fees, and all of these hidden and misleading charges in the Terms and Conditions…all things you’re not really thinking about when you start to apply for student credit cards.

The American consumer society has become used to not trusting businesses and having to do a lot of research because of the tactics of careless companies. This is warranted because they want to make sure that you truly can provide them with solid value and at the same time it goes too far. That is why it is so important for companies to brand themselves excessively to drill themselves into your mind.

How many Capital One commercials have you seen with their funny skits ending with a simple question, “What is in your wallet?” How many priceless MasterCard commercials have you seen that have made you all warm and fuzzy inside when you realize it is all about making people happy, no matter what goes on the card. This is the beauty of credit cards. They are trying so badly to warm up with you to get your business, but everyone does this.

Obviously for them to spend millions on ads, they have gotten somewhere to do so. It just didn’t happen and surely not by destroying trust with millions of customers. If they did then the government would shut them down. Instead, they have solid systems in place. They take good care of their customers and are willing to resolve issues with you to keep your business. You have to build their trust too in this relationship because it is their money that you are using, no matter what you want to think. So if you build that trust then it should not matter.

So for a college student it doesn’t matter if it is Capital One, Visa, MasterCard, Discover, or whomever. They are all good. You just need to be fair to yourself and see what they all have to offer. Don’t go and apply for a boat load of cards or pick your favorite card based on your favorite commercial. Do your research first before your apply. Start with one card and build a good credit history and then you can move on to other lines of credit as you build a stronger income in your life and establish a household.

Consolidate Student Loans and Credit Cards

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I don’t think most high school seniors fully grasp what they’re getting into when they go to college. And I’m not talking about the classes, choosing a major, trying to decide what career you want to go into when you graduate, the parties – I’m not talking about any of that.

I’m talking about money. In business when you talk about fully loaded costs you’re talking about factoring in every single penny that goes into the operation of your business. Most kids don’t know what the fully loaded costs of college are, because it goes way beyond tuition.

Of course they still go, and they get their degree (a lot of them do anyway), and what do they end up with? Debt. Mountains of debt.

Here are a couple of statistics to prove the point*:

*According to CreditCards.com.

That’s a lot of debt, and a lot of kids are carrying it at high interest rates. If they don’t do something about those interest rates, they could be in that debt for the rest of their lives. Or worse, they file for bankruptcy. That’s why so many graduating college students are looking to consolidate student loans and credit cards.

How to Find a Consolidation Company for Student Loans and Credit Cards

I can tell you this – there are about a billion of them out there. I got out of school over three years ago and I’m still getting offers in the mail from companies trying to help me “save thousands in student loan payments”. I also get stacks of offers from credit card companies offering lines of credit to consolidate my credit cards.

It’s pretty much this simple – look around. Use google. Use consumer reports. Find a company that is going to truly save you a lot of money by consolidating your debt for you. I can tell you it will usually be in your best interest to do some kind of student loan consolidation program, because they can get you really low rates.

You have to watch them on the fee side. I’m not saying they shouldn’t make money. I’m saying they shouldn’t set you back a couple years of payments just to get you set up with your new plan. They’ll make plenty of money on the other side of your loans, because they can sell them off to other debt companies. Consult with a finance professor or an accountant for advice on which offer is the right one for your circumstances.

Credit Cards for Student Looking To Build Credit History

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There are plenty of credit card companies that are willing to send offers in the mail, bombard your e-mail account, and call to see if you want credit cards. These companies are drooling to offer credit cards for students looking to build credit history. I remember when I turned 18 my mom kept a huge stack of all of the credit offers that I started receiving. It was relentless and made me think of how many companies out there are looking to prey on college and high school students to get them to spend money carelessly. Many credit card providers take the same stance as gun dealers, “Card issuers don’t kill credit, customers do.” This can be a very true statement because many students are willing to dump their credit in the trash very quickly.

First of all I think that you need to realize quickly how important your credit is. There are so many things you can purchase out there where your credit is going to be vital. Good luck getting a car or house without good credit. You better have liquid assets to use or even if you get your desired items then you will probably have to pay high interest rates or have large payments required. You will appreciate good credit often, even in simple purchases where a credit check is necessary to get a security system, a boat, furniture, televisions, cell phones, etc. It is basically your financial integrity to society.

Here are some things to look at before getting a credit card. Start by opening a checking account and a savings account. This is a good sign for a creditor to tell of your financial history and if you pay off bills like rent or utilities. Next get a store credit card and pay off your items you buy there promptly. These are easy to obtain, they give you some kind of discount, and can help you to start intelligent credit habits. You might have to get a secured credit card initially, which will require a deposit that equals the credit limit you are going to establish. This is another nice way to get your foot in the door.

When I was in high school I got a line of credit through my mom’s account that she cosigned on. This helped me out a lot. I really never used the card and my mom taught me early on how to pay these cards off consistently. If you are concerned you will not be able to pay it off or just want to save time then do what I did and set up an automatic payment relationship. When it came time to get my own account it was easy. So approach your parents and explain you want to establish your credit. Most parents would consider that very mature of you and look for some way to help you do that.