Can You Keep Any Credit Cards After Filing For Bankruptcy?
Most bankruptcy trustees will make sure that you surrender your credit cards after the 341 hearing. What is important to consider is that the trustees don’t have any type of specific legal authority that will force you to relinquish these cards. Here’s some more information on what you can expect to happen to your credit cards after filing for bankruptcy.
You Must Include All Credit In Your Bankruptcy
When you file for bankruptcy you need to include all of your debts on your bankruptcy papers. As soon as you qualify for bankruptcy a court will send out a notice of your bankruptcy to all creditors listed in the document. All of the credit card companies that you’re currently working with will receive a notice of bankruptcy and they will likely cancel your card at that time.
What If I Don’t Carry A Balance On All Credit Cards?
You must disclose all your debts in a bankruptcy proceeding but if you do have a card that does not carry a balance, this is not considered a debt. You will not have to list cards with zero balance. As long as the credit card is not listed on a bankruptcy, this letter will not receive a notice of bankruptcy from the court. Your bankruptcy filing will be on the public record and is reported to credit reporting agencies. This means that the company that you carry zero balance with will likely still find out about your bankruptcy.
If you’d like to oppose the request of a trustee to take access to your credit cards, you usually have to have a good reason for wanting to hold on to your cards. Even if you choose to hold onto a card with zero balance, the company carrying a credit card will likely cancel the card when they find out about your bankruptcy or offer you a significantly higher interest rate.
If you’re planning on strategically keeping hold of one of your credit cards after filing for bankruptcy, keep in mind that this is not usually an easy process. You may have to go credit free for a series of months until you can access a secured credit card or another financial product to rebuild your credit.
This post was written by Trey Wright, one of the best bankruptcy lawyers in Tallahassee FL! Trey is one of the founding partners of Bruner Wright, P.A. Attorneys at Law, which specializes in areas related to bankruptcy law, estate planning, and business litigation.
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