10 Best Credit Cards After Bankruptcy Discharge – (Rebuild Credit)

10 Best — Credit Cards After Bankruptcy Discharge (Rebuild Your Credit)

credit card advice

Sean Garrity
By: Sean Garrity
Posted: February 15, 2017
Opinions expressed here are ours alone, and are not provided, endorsed, or approved by any issuer. Site may be compensated through the issuer affiliate programs.

While no one likes to admit defeat, sometimes our debts simply get the better of us and bankruptcy may become the only option for a better financial future. Unfortunately, your credit will see lasting negative impacts from a bankruptcy, but you can repair your credit with some hard work — and a lot of patience.

One of the first steps you should take after your bankruptcy is complete is to check all three of your credit reports. Make sure all of the accounts that were affected by the bankruptcy accurately reflect their new status, or have been properly removed.

The next step is to start rebuilding your credit. A big bankruptcy myth is that you will only be able to qualify for a secured credit card after bankruptcy, but that’s not always true in today’s credit market. Some lenders, particularly subprime lenders, will consider post-bankruptcy applicants for unsecured cards. Begin your search with our expert-rated picks.

Unsecured Cards (5) | Secured Cards (5) | Bankruptcy Basics

Top 5 Unsecured Credit Cards to Apply for After Bankruptcy

The major reason many prefer unsecured credit cards to secured cards is, really, the major difference between the two: the deposit. A secured credit card is secured by the deposit you put down, and, in most cases, that deposit will set your credit limit. An unsecured card requires no deposit but may have more stringent requirements.

Fingerhut Credit Account Review

at Fingerhut'ssecure website

UNSECURED RATING

★★★★★
4.7

OVERALL RATING

4.0/5.0
  • Holiday gifts they'll like, payments you'll love! Use your line of credit to shop over 550,000 items from great brands like Samsung, KitchenAid, and DeWalt
  • Take advantage of low monthly payments if you apply and are accepted for a Fingerhut Credit Account issued by WebBank, who determines eligibility and qualifications for the terms of credit
  • Fast, easy online application process and a quick decision
  • Not an access card
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
See Issuer Website
$0
Poor Credit
Total Visa® Card Review

at the issuer'ssecure website

UNSECURED RATING

★★★★★
4.5

OVERALL RATING

3.5/5.0
  • Checking Account Required
  • Fast and easy application process; response provided in seconds
  • A genuine VISA card accepted by merchants nationwide across the USA and online
  • Manageable monthly payments
  • If approved, simply pay a Processing Fee to open your account and access your available credit
  • Reports monthly to all three major credit bureaus
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
See Terms
See Terms
Fair, Bad Credit
Credit One Bank® Visa® Credit Card with 1% Cash Back Review

at Credit One'ssecure website

UNSECURED RATING

★★★★
4.0

OVERALL RATING

3.7/5.0
  • This unsecured card requires no deposit and can help build your credit
  • Receive opportunities for credit line increases, a fee may apply
  • See if you Pre-Qualify in less than 60 seconds
  • Receive 1% cash back on eligible purchases, terms apply
  • Choose your monthly payment due date for added convenience, terms apply
  • Monitor your credit with free online access to your credit score
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
16.99% - 24.99% Variable
$0 - $99
Poor
First Access Visa® Card Review

at the issuer'ssecure website

UNSECURED RATING

★★★★
4.0

OVERALL RATING

3.5/5.0
  • Checking Account Required
  • Reporting monthly to all three major credit reporting agencies
  • Perfect credit not required for approval; we may approve you when others won’t
  • Easy and secure online application
  • If approved, pay a Processing Fee and you can access the $300 credit limit (subject to available credit)
  • Issued by Mid America Bank & Trust Company, founded 1920, Member: FDIC
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
See Terms
See Terms
Bad Credit
Milestone® Mastercard® - Bad Credit Considered Review

at the issuer'ssecure website

UNSECURED RATING

★★★★
4.0

OVERALL RATING

3.9/5.0
  • Prequalify for a card today and it will not impact your credit score
  • Less than perfect credit is okay
  • Mobile account access at any time
  • Protection from fraud if your card is stolen
  • Account history is reported to the three major credit bureaus in the U.S.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
23.9%
$35 - $99
Bad, Poor Credit

+See More Unsecured Credit Cards

One good way to see if you may qualify for a particular card before going through a hard credit pull is to check for pre-qualification offers. Most issuers offer a pre-qualification process that usually involves a soft credit pull and won’t affect your credit score.

5 Best Secured Credit Cards for Post-Bankruptcy Bad Credit

If you don’t qualify for an unsecured credit card or prefer setting your own credit limit through a deposit, secured credit cards are a great option. Because the card is secured by your deposit, almost anyone can qualify for a secured card.

SECURED RATING

★★★★★
5.0

OVERALL RATING

4.0/5.0
  • No annual fee, and all the credit building benefits with responsible card use
  • Unlike a prepaid card, it builds credit when used responsibly, with regular reporting to the 3 major credit bureaus
  • You will get an initial $200 credit line after making a security deposit of $49, $99, or $200, determined based on your creditworthiness
  • Get access to a higher credit line after making your first 5 monthly payments on time with no additional deposit needed
  • Easily manage your account 24/7 with online access, by phone or using our mobile app
  • It's a credit card accepted at millions of locations worldwide
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
24.99% (Variable)
$0
Limited, Bad
Discover it® Secured Card - No Annual Fee Review

at Discover Card'ssecure website

SECURED RATING

★★★★★
4.5

OVERALL RATING

3.7/5.0
  • No Annual Fee, cash back on every purchase, and helps you build your credit with responsible use.
  • Your Secured Credit Card requires a refundable security deposit up to the amount we can approve of at least $200 which will establish your credit line. You will need to provide your bank information when submitting your security deposit.
  • We will automatically begin reviewing your account starting at 8 months to see if we can transition you to an unsecured line of credit.
  • Earn 2% cash back at restaurants & gas stations on up to $1,000 in combined purchases each quarter. Plus, 1% cash back on all your other purchases.
  • Get a dollar-for-dollar match of all the cash back you've earned at the end of your first year, automatically.
  • New! Receive FREE Social Security number alerts-Discover will monitor thousands of risky websites when you sign up.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
10.99% for 6 months
23.99% Variable
$0
Please refer to issuer's website
OpenSky® Secured Visa® Credit Card Review

at Capital Bank'ssecure website

SECURED RATING

★★★★
4.0

OVERALL RATING

2.9/5.0
  • No credit check necessary to apply. OpenSky believes in giving an opportunity to everyone.
  • The refundable* deposit you provide becomes your credit line limit on your Visa card. Choose it yourself, from as low as $200.
  • Build credit quickly. OpenSky reports to all 3 major credit bureaus.
  • 99% of our customers who started without a credit score earned a credit score record with the credit bureaus in as little as 6 months.
  • We have a Facebook community of people just like you; there is a forum for shared experiences, and insights from others on our Facebook Fan page. (Search "OpenSky Card" in Facebook.)
  • OpenSky provides credit tips and a dedicated credit education page on our website to support you along the way.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
18.39% (Variable)
$35
No Credit Check
First Progress Platinum Prestige MasterCard® Secured Credit Card Review

at First Progress'ssecure website

SECURED RATING

★★★★
3.9

OVERALL RATING

2.9/5.0
  • Fund your new MasterCard® secured credit card with your tax refund today!
  • Our card reports monthly to all three major bureaus and approval is based upon a fully-refundable security deposit.
  • We can approve you at any credit score, no minimum required.
  • No processing or application fees required.
  • Full-featured Platinum MasterCard, accepted for car rentals, hotels, and millions of other locations worldwide.
  • Credit Line Secured by Your Fully-Refundable Deposit of $200 - $2,000 Submitted with Application
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
9.99% (Variable)
$49
Bad / No Credit
First Progress Platinum Select MasterCard® Secured Credit Card Review

at First Progress'ssecure website

SECURED RATING

★★★★
3.8

OVERALL RATING

2.7/5.0
  • Fund your new MasterCard® secured credit card with your tax refund today!
  • Receive Your Card More Quickly with New Expedited Processing Option
  • No Credit History or Minimum Credit Score Required for Approval
  • Good for Car Rental, Hotels; Anywhere Credit Cards are Accepted!
  • Monthly Reporting to all 3 Major Credit Bureaus to Establish Credit History
  • Credit Line Secured by Your Fully-Refundable Deposit of $200 - $2,000 Submitted with Application
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
13.99% (Variable)
$39
Bad Credit

+See More Secured Credit Cards

One of the aspects of your credit score is your utilization rate, or the ratio of available credit to debt. With a secured card, your deposit can determine your credit limit, meaning you may be able to achieve a higher limit with a secured card than an unsecured credit card.

Bankruptcy Basics

Bankruptcy is a last-ditch option for those overwhelmed by debt. The actual effects of bankruptcy proceedings depend on the type of bankruptcy declared, but can include debt forgiveness or moderated repayment. For individuals, the most common types of bankruptcy are Chapter 7 and Chapter 13.

Obtaining a Bankruptcy Discharge

A bankruptcy discharge is the goal of the bankruptcy process and is the actual legal order that says you are no longer obligated to pay any discharged debts. Once discharged, creditors holding a debt may no longer attempt to collect on that debt, either by mail, phone, or in person.

Each debt being considered for discharge has a fixed time during which a complaint objecting to the discharge may be filed. If there is no litigation objecting to the discharge, debtors will generally receive a discharge automatically.

Chapter 7 vs. Chapter 13 Bankruptcy

For the most part, the difference between Chapter 7 bankruptcy and Chapter 13 bankruptcy is a matter of scope and qualification. Under Chapter 7 bankruptcy, many of your unsecured debts can be completely wiped out, including credit card debt and medical bills. When you file for Chapter 13 bankruptcy, you’ll be required to pay back some portion of your existing debt.

Since Chapter 13 bankruptcy involves paying off your debts over time, you won’t receive a final discharge until all payments have been made under the plan, which can take between three and five years. In contrast, Chapter 7 is much faster, with complete discharge typically being reached within six months.

All that being said, not all debtors can qualify for Chapter 7. If you make too much money and/or have too much disposable income, you may not be able to file Chapter 7. Additionally, if you want to maintain ownership of any property or other collateral used for a secured debt, including real estate and automobiles, you should choose Chapter 13 bankruptcy.

Rebuilding Your Credit After Bankruptcy

Though your debts may have gotten the better of you, recovering from a bankruptcy is possible. No matter which road you take through the bankruptcy process, the key to rebuilding your credit afterward is patience. Rebuilding your credit will require you to demonstrate healthy financial habits, including the ability to maintain credit accounts — in good standing — over a period of time.

Don’t apply for a dozen credit cards hoping to boost your credit quickly — this will backfire. Stick to one or two cards, use your credit modestly, and pay off any debts in full each month. If you are diligent, you will be able to see your credit improve over the course of months and years.