Is there a way to keep a credit card I need when filing bankruptcy?

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Written by Andrea Wimmer, Esq..  
Updated June 22, 2020

Summary

Unfortunately, there’s no way to keep a credit card, no matter the reason. If you owe a balance on the credit card, you have to list it as a debt. The debt will be discharged and the account closed by the creditor. Bankruptcy law requires that you list all of your debts. You are not allowed to simply “leave out” one of your credit cards. 

Person at desk getting information organized.

Unfortunately, there’s no way to keep a credit card, no matter the reason. 

If you owe a balance on the credit card, you have to list it as a debt. The debt will be discharged and the account closed by the creditor. Bankruptcy law requires that you list all of your debts. You are not allowed to simply “leave out” one of your credit cards. 

Credit cards with a zero balance do not have to be listed on your bankruptcy forms and the creditor will not receive a bankruptcy notice from the court. However, all major credit card issuers run period credit checks on their customers. Once they realize that you’ve filed bankruptcy, your account will likely be closed by the bank. 

What can you do? 

If you have a bank that you’ve been with for a long time, talk to them about opening a credit card after your case has been filed. They know that you can’t file again for quite some time and may give you more favorable rates than a bank you don’t have a relationship with. 

If that’s not an option, don’t worry. You will receive quite a few credit card and loan offers in the mail after your bankruptcy case has been filed. To begin rebuilding your credit, take advantage of one of these offers, but pay close attention to the terms and conditions, so you don’t end up taking on more than you can afford. 

I have to have access to credit to pay for necessities

If you can’t afford your bare necessities (housing, food, and medical expenses) with your current income, consider postponing your bankruptcy filing. Filing for bankruptcy will not help you in the short term and can limit your options for relief. Check out this example to understand why

On the other hand, if you haven’t been able to pay your living expenses because you’ve been making payments to your creditors, remember that filing bankruptcy will put an end to that. In that case, try not to ever rely on credit cards for anything, and instead set up a budget to follow. Get a credit card to rebuild your credit, but don’t use it to pay for necessities.

About the author

Andrea Wimmer, Esq.

Andrea practiced exclusively as debtors’ counsel in consumer chapter 7 and 13 cases for more than 10 years before joining Upsolve, first as a contributing writer and editor and ultimately joining the team full time in August 2019. While in private practice, Andrea handled all ban... read more

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Upsolve is a 501(c)(3) nonprofit that started in 2016. Our mission is to help low-income families who cannot afford lawyers file bankruptcy for free, using an online web app. Spun out of Harvard Law School, our team includes lawyers, engineers, and judges. We have world-class funders that include the U.S. government, former Google CEO Eric Schmidt, and leading foundations. It's one of the greatest civil rights injustices of our time that low-income families can’t access their basic rights when they can’t afford to pay for help. Combining direct services and advocacy, we’re fighting this injustice.

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