Can discharged bankrupts get credit cards?

When a person has been bankrupt then it can be hard to get any future credit cards.  This does not mean that it is impossible, just that it is much harder.  In fact credit cards can be a way for a person to rebuild their credit rating.

One thing that a person who has been through bankruptcy must understand is that they may not have the legal disabilities that they had when they were actually bankrupt, but their credit record is likely to be very bad and that this is likely to stay with them for a long time.

Credit card companies are attached to the use of credit scores in order to decide who they wish to give their credit cards to.  This will mean that a person with a good credit history will have a wide range of cards to choose from, while a person with a bad credit history will have a narrower choice.

However there are people who are willing to allow a person to borrow money on a credit card.  These are specialist lenders, and the credit cards that they issue tend to have higher interest rates, shorter interest free grace periods and generally worse terms and conditions.  Many of these specialist lenders are divisions of larger banking groups.  The credit cards also tend to be differentiated so they will tend to ask very exact questions as to the exact credit status of the applicant.

Prepaid credit cards are also an option for some discharged bankrupts.  These are credit cards that have to be topped up before they are used.  This means that there is no actual borrowing on a credit card but the credit card holder will be able to use the credit card to pay for goods over the internet and over the phone.  However as there is no borrowing on the card then there is also no reporting to credit bureaus and prepaid credit cards cannot be used to raise a person’s credit score.

Secured credit cards are slightly different.  Instead of having a credit card that is prepaid the credit card is instead secured, so that the card is backed up by a sum of money that is deposited into a bank account.  This will mean that the credit card can report to credit bureaus and will help a discharged bankrupt to rebuild their credit.