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Can credit cards be kept while filing for bankruptcy?
by: Allys Marks
No matter how much of a trouble that the citizens of America have undergone due to credit card debts they would want to have them still. For them it is the safest and the most convenient means to pay for the necessities of life. During a bankruptcy proceeding, the judge, who is responsible to look after the documents etc can ask several questions to the consumers which are often related to their financial circumstances; basically they want to make sure, if debt settlement could have been an option for the debtor or not. If the judge is satisfied, the debts are usually discharged. However, as we all know that a bankruptcy record will remain on the credit charts for no less than ten years in a row. But if you want to keep the your cards you should be aware of the following regulations:
• According to the bankruptcy code, a debtor is required to make a list of all the debts and the respective creditors on the date of filing bankruptcy. In case of an existence of a zero balance credit card, it does not have to be included in the list and that card has company not served with a notice.
• Usually, a debtor who has filed for bankruptcy Chapter 13 is prohibited from using the c.cards without prior approval from the bankruptcy trustee or the court; an approval of credit is conditional during a bankruptcy filing and depends upon a written agreement from the such card company. However, in case of Chapter 7 such restrictions do not exist.
• Any payment related to the mention card which occurs within 90 days of bankruptcy filing may be considered as preference payment. On the other hand, the bankruptcy trustee can obtain a court order to turn over the pre filing payments.
• The saying card companies are far too careful in checking the accounts of their card holders and a bankruptcy filing can lead them to close the account or to reduce the line of credit. Such actions are possible, if the debtor tries to confirm the status of their credit card debts ; under such circumstances, that cards may be cancelled leaving the debtor with a non discharged there card balance.
• It is of utmost importance that the debtors should disclose the existence of a credit card with a balance, during a bankruptcy filing.
• As far as securing for a card after bankruptcy is concerned the debtors are often able to get one on the basis of the fact that another bankruptcy filing may not be possible within a period of seven years. But these cards often carry higher rates of interest and offers.
Therefore, the such cards with balances will have to be declared as debt after a bankruptcy filing; on the other hand, the ones with a zero balance can be kept. However secured saying cards are a better option which can help the consumers to have saying cards with reasonable rates of interest.
About The Author
allysamarks is a Journalist who writes on various Debt settlement and bankruptcy related financial articles.Get to know more about the related topics from http://www.bestdebtdoctor.com/
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