Why You Can’t Have a Credit Card After Filing Chapter 13 Bankruptcy in Lincoln

July 12, 2022 | By Steffens Law Office
Why You Can’t Have a Credit Card After Filing Chapter 13 Bankruptcy in Lincoln

Sadly, no, you can't keep or get a new credit card after filing Chapter 13 bankruptcy in Lincoln. Unless the court gives you special permission, you can’t take on any new debts while you’re in a Chapter 13. We understand how frustrating that can be. Fortunately, you can still use a debit card during a Chapter 13.  You may feel concerned about any upcoming emergencies or how to rebuild your credit for after the bankruptcy. Below, our Lincoln bankruptcy lawyer explains what you need to know if you're ever in this situation.

Why You Can't Have a Credit Card After Filing Chapter 13 Bankruptcy in Lincoln

According to our Lincoln bankrupcty lawyer, there are many protective reasons why the courts won’t allow you to use a credit card during a Chapter 13 bankruptcy, including:

But won’t having a secured credit card help me rebuild my credit?

  1. Probably not, and you can’t have a secured credit card while in a Chapter 13 either. The best way to build your credit is to make your monthly payment to your trustee so that the remaining debt can be discharged at the end of the bankruptcy.
  2. Starting out with no debt at the end of your bankruptcy will be much better, since you’ll have nothing to hold you back!

Why can’t I have a credit card for emergencies?

  1. Sudden necessities are difficult to handle. If necessary, there are ways to get a loan with permission from the court. But a credit card creates the possibility of taking on more debt, with the risk of high interest rates. Then you could be in the same position as before!
  2. A credit card could put you at risk of overextending your finances and make difficult for you to pay the trustee. That will put you at risk of not getting a bankruptcy discharge!
We understand that going through a bankruptcy may change the way you handle your finances for a time, and that’s a difficult thing to change. However, a discharge from a Chapter 13 bankruptcy can change your life for the better and put you back in charge of your finances. We want you to have that freedom.

Contact Our Chapter 13 Bankrupcty Lawyer in Lincoln Today!

If you have any questions or are wondering if a chapter 13 filing is right for you and your family, give our experienced Lincoln bankruptcy lawyer a call at (308) 872-8327. Our attorneys are eager to give you all the tools you need to break free from debt.