Bankruptcy will make your credit score plummet and make it very difficult to open new credit card accounts. Fair Isaac Corp. (FICO), the company that determines your credit score, says the worst effect is in the first year after your bankruptcy, but there will be some influence for as long as it remains on your credit reports. Most bankruptcies should be removed after seven years, after which they are no longer figured into your credit score. You must be sure this happens so your ability to get credit cards is no longer impaired by this old information.
Step 1
Review your three credit reports to make sure that each of the credit bureaus has removed the bankruptcy listing as soon as seven years have passed, FICO advises. The annualcreditreport.com website provides free reports annually under the terms of the Fair Credit Reporting Act. TransUnion, Equifax and Experian do not cross reference their information so it could be removed by one bureau but not the others. File a dispute to have the bankruptcy removed if it is still being listed by any of the bureaus.
Step 2
Recheck your credit reports after your dispute is resolved to make sure the bankruptcy is gone. The credit bureaus usually follow through promptly if you have a valid dispute, but sometimes they do not remove the incorrect item. Be sure it's gone before filling out any credit card applications so it will have no influence on the bank's decision.
Step 3
Fill out the application for a new credit card. You will not need to list your bankruptcy because it is seven years old or more. Provide the required information, which will include your personal information and social security number, income information and other loans and accounts. You should have no problem getting approved as long as you have managed your finances properly in the years since your bankruptcy filing.
Tips and Warnings
- Some bankruptcy types can stay on your credit report for ten years but you should still be able to get a credit card after seven years, MSN Money columnist Liz Pulliam Weston explains. You will qualify as long as you have been paying your bills on time and managing your credit accounts responsibly for the past several years.
- FICO warns that some of your credit accounts may erroneously be reported with bankruptcy status even if they were not included in your filing. This will decrease your ability to get credit. Dispute any accounts that are being reported with the wrong status, as well as any other mistakes you find during your credit report check.
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