Three Things To Know About Credit Card Use When Filing Bankruptcy
Chances are, if you have filed bankruptcy or are considering doing so, you have a substantial amount of credit card debt. The interest charged by most card companies is high, making it nearly impossible to pay off credit card debt if all you are able to do is make the minimum payment each month. When you file for bankruptcy, you should stop using your credit cards, and most companies will put a hold on your account to prevent future charges. For those companies that don’t block charging ability, proceed with caution.
Fox Business offers the following advice, with these top three things to know about credit card use when filing bankruptcy:
- Any credit card you have included in your bankruptcy will no longer be available to you, but the chances of receiving offers from other companies after your bankruptcy is over (or even during the pendency) is high.
- If you decide to open an account with a new credit card company, be sure to keep the balance low and pay it off monthly. This will prevent you from incurring debt that spirals out of control and accumulates large amounts of interest to be repaid.
- Opening a new account can help you to re-establish your credit, as long as you act responsibly and make the payments on time and as required.
Other options for credit card use include opening a secured account. This type of credit card is one where you pay a certain amount to the card to secure your repayment of future charges. It is not uncommon for those in a bankruptcy to be made this type of offer, but accepting the offer must fit within your budget. Bankruptcy offers you a fresh financial start, and taking steps after your case is over to keep on track is important to your future finances and budget. Once you have received a discharge of debts, the last thing you want to do is find yourself in financial distress again. If you have questions about bankruptcy, credit card use, and how to get out of debt, call our office.
If you have questions about bankruptcy and credit card use, contact our office for help. We will explain your options, so you understand your choices and can make a decision that meets your needs. Call a Plantation, Florida debt relief attorney today for more information.