I’ve filed for bankruptcy in Miami, Florida, how can I rebuild my credit after my bankruptcy is over?

One of the most common questions I get from clients is, once my bankruptcy is complete how can I begin to rebuild my credit?  The easiest answer is to get a secured credit card.

 

A secured credit card is a type of credit card that is backed by a savings or escrow account that will be used as collateral on the credit limit of the card.  Basically in order to get a $500.00 limit on a credit card you will need to open up an escrow account with $500.00.  You use and pay on your credit card as you go but if you fail to pay on your card the secured card will take the money in your escrow account and use it to pay off your card.

 

There are a few things to consider when shopping for a secured credit card:

 

  1.  How much money do you need to put down in escrow or savings to get the card.
    1. Shop around for the card that suits your credit limit and make sure you can afford to put the amount required down so that you can open up the card.
    2. Under what circumstances can the secured credit card company take your collateral (savings/escrow money)
      1. This will differ by each vendor.  Will they allow you to be one or two months late before they take your collateral or will they take your collateral instantly.  Make sure to ask this question.
      2. What types of monthly fees are associated with the secured credit card?
        1. Do you get charged per usage, per month, etc. ask and shop around to find the best card for you.
        2. How and when can you convert a secured credit card into an unsecured credit card?
          1. Lots of these secured credit cards allow you to switch to an unsecured credit card within a matter of months (and thus not require you to have a savings/escrow account)
          2. Will my secured credit card report to the credit bureaus?
            1. This is THE MOST IMPORTANT question to ask.   You need a secured credit card that reports to the credit agencies so that you may begin to reestablish your credit.

 

If you are thinking of filing for bankruptcy and would like to schedule a free consultation with a bankruptcy attorney then please contact Ofer Shmucher of Shmucher Law, PL by calling 305.741.5553 or 954.309.5559.  We offer free consultations in any of our office locations including Boca Raton, Fort Lauderdale, Miami, and Plantation.

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