Filing for bankruptcy can cause your credit score to drop dramatically, but you won't need to suffer from bad credit forever. Depending on the type of bankruptcy, the filing will generally disappear from your credit report after seven to ten years. Applying for secured credit cards can help you make a quicker comeback from bankruptcy as they are more accessible to those with a low or no credit score and have requirements that encourage positive credit habits.
Unlike traditional credit cards, secured credit cards require a cash deposit that acts as your credit limit and collateral for every purchase you make. You get the money back when you close your account or transition to an unsecured card.
CNBC Select analyzed the top secured credit cards to determine which ones are best to get after bankruptcy. The bankruptcy credit cards we selected stood out for offering features like low deposit minimums and the ability to earn rewards. (See our methodology for more information on how we made this list.)
Best post-bankruptcy credit cards
Best for no credit check
OpenSky® Secured Visa® Credit Card
Rewards
New feature! Earn up to 10% cash back on everyday purchases
Welcome bonus
No welcome bonus
Annual fee
$35
Intro APR
N/A
Regular APR
25.64% Variable
Balance transfer fee
N/A
Foreign transaction fee
3%
Credit needed
No credit history
Terms apply. Click here to view the Cardholder Agreement.
Pros
- No credit check, regardless if you have a credit score
Cons
- $35 annual fee
- 3% fee charged on purchases made outside the U.S.
Who's this for? The OpenSky® Secured Visa® Credit Card is great for people who don't have a credit score or insufficient credit history. That's because, unlike many other credit cards, it doesn't run a hard inquiry on your credit when you apply.
Standout benefits: The fact that this issuer doesn't run a hard credit check is a huge plus. Cardholders can potentially receive a credit limit as high as $3,000. The typical maximum credit limit for a secured credit card usually sits at around $2,500 so the limit for this card is a bit higher.
Minimum/maximum security deposit: New cardholders must put down a minimum deposit of $200. The maximum deposit amount is $3,000.
Best for welcome bonus
Discover it® Secured Credit Card
Rewards
Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter, automatically. Plus earn unlimited 1% cash back on all other purchases.
Welcome bonus
Discover will match all the cash back you've earned at the end of your first year
Annual fee
$0
Intro APR
N/A on purchases
Regular APR
28.24% Variable
Balance transfer fee
3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)*
Foreign transaction fee
None
Credit needed
New / Rebuilding
*See rates and fees, terms apply.
Pros
- Cash-back program
- Generous welcome bonus
- Starting at seven months from account opening, Discover will automatically review your credit card account to see if you can transition to an unsecured line of credit and return your deposit
Cons
- Cash-back program limits earnings: 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter, then 1%
- Low credit line prevents cardholders from charging high-cost items or many expenses
Who's this for? The Discover it® Secured Credit Card is ideal for those seeking a secured credit card with features similar to an unsecured card. Unlike many other secured cards, the Discover it® Secured Credit Card offers a welcome bonus and earns rewards on everyday purchases.
Standout benefits: Aside from the welcome bonus, cardholders can earn 2% cash back from gas stations and restaurants on up to $1,000 in combined purchases each quarter (after, they earn 1%). Cardholders can also automatically earn unlimited 1% cash back on all other purchases. Plus, after the first seven months from account opening, Discover automatically reviews your account to see if you can be transitioned to an unsecured line of credit and have your deposit returned.
Minimum/maximum security deposit: New cardholders must put down a minimum deposit of $200. The maximum deposit amount is $2,500.
Best for low deposit minimums
Capital One Platinum Secured Credit Card
Rewards
None
Welcome bonus
No current offer
Annual fee
$0
Intro APR
N/A for purchases and balance transfers
Regular APR
29.99% variable
Balance transfer fee
$0 at the Transfer APR, 4% of the amount of each transferred balance that posts to your account at a promotional APR that Capital One may offer to you
Foreign transaction fee
None
Credit needed
No credit history
See rates and fees, terms apply.
Pros
- No annual fee
- $49, $99 or $200 refundable deposit
- No fee charged on purchases made outside the U.S.
Cons
- High variable APR
- No rewards program
Who's this for? The Capital One Platinum Secured Credit Card (see rates and fees) is ideal for those seeking a low-security deposit minimum. While secured credit cards generally have a minimum of around $200, this card's refundable security deposit amount starts at $49.
Standout benefits: The biggest draw for the Capital One Platinum Secured Credit Card is the ability to open the card with a lower security deposit amount. This makes the card more accessible for those who may not be able to afford higher security deposits. Cardholders will also automatically be considered for a higher line of credit after making the first five monthly payments on time
Minimum/maximum security deposit: New cardholders must put down a minimum deposit of $49, $99 or $200, based on their creditworthiness. The maximum deposit amount is $1,000.
Best for earning cash back
U.S. Bank Cash+® Visa® Secured Card
Rewards
5% cash back on your first $2,000 in combined eligible purchases each quarter in two categories you choose, 2% cash back on eligible purchases in your choice of one everyday category (like gas stations, grocery stores and restaurants) and 1% cash back on all other eligible purchases
Welcome bonus
None
Annual fee
$0
Intro APR
None
Regular APR
29.99% variable
Balance transfer fee
Either 3% of the amount of each transfer or $5 minimum, whichever is greater.
Foreign transaction fees
3%
Credit needed
Poor/None
Pros
- No annual fee
- You can earn cash-back for everyday spending, a rare feature for a secured credit card
- Opportunity to upgrade to an unsecured card if you pay your bills on time and stay within your credit limit
Cons
- No welcome offer
- High APR
- 3% fee charged on purchases made outside the U.S.
Who's this for? The U.S. Bank Cash+® Visa® Secured Card is for anyone who wants to get their credit score back on track while also earning cashback along the way.
Standout benefits: Cardholders can earn 5% on the first $2,000 spent in combined eligible purchases each quarter in two of 12 categories of their choosing. On top of that, cardholders can earn 2% cash back on eligible purchases in one additional everyday spending category of their choice (think gas stations, grocery stores and restaurants). Cardholders earn 1% cash back on all other eligible purchases.
Minimum/maximum security deposit: New cardholders must put down a minimum deposit of $300. The maximum deposit amount is $5,000.
More on our top unsecured credit cards
OpenSky® Secured Visa® Credit Card
The OpenSky® Secured Visa® Credit Card is unique in that it won't perform a hard inquiry on your credit report during the application process. It can also be more useful than some other secured cards in that it offers a slightly higher security deposit limit compared to some alternatives.
Rewards
None
Welcome bonus
None
Annual fee
$35
Notable perks
The OpenSky® Secured Visa® Credit Card allows cardholders to make a higher security deposit than many other secured cards with a maximum deposit amount of $3,000. The slightly higher limit on this card provides a bit more flexibility for higher expenses. Plus, after six months, OpenSky considers cardholders for a credit line increase with no additional deposit required.
Discover it® Secured Credit Card
The Discover it® Secured Credit Card stands out for offering an appealing welcome bonus, which is uncommon among secured cards. On top of that, it offers cashback rewards on everyday purchases, doesn't charge an annual fee and offers a clear path to upgrading to an unsecured card.
Rewards
- 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases per quarter
- 1% cash back on all other purchases
Welcome bonus
Discover matches all the cash back you've earned in your first year. The match gets applied at the end of your first year.
Annual fee
$0
Notable perks
Most other secured credit cards don't offer any sort of welcome bonus or rewards program, so the Discover it® Secured Credit Card is unique in that respect. The card also doesn't charge a foreign transaction fee. Additionally, after seven months from account opening, your account will automatically be considered for transitioning to an unsecured credit card.
Capital One Platinum Secured Credit Card
The Capital One Platinum Secured Credit Card (see rates and fees) is a secured card that can be opened with a minimum security deposit of $49, $99 or $200, based on your creditworthiness. Even if you qualify for the low $49 or $99 deposits, you'll still receive a $200 credit limit.
Rewards
None
Welcome bonus
None
Annual fee
$0
Notable perks
In addition to offering all cardholders a $200 minimum credit limit, the Capital One Platinum Secured Credit Card automatically considers cardholders for a credit limit increase after making the first five monthly payments on time. This helps you both raise your credit score and practice responsible card management.
U.S. Bank Cash+® Visa® Secured Card
Much like the Discover it® Secured Credit Card, the U.S. Bank Cash+® Visa® Secured Card offers generous cashback rewards, which is uncommon among secured credit cards. Plus, cardholders have the flexibility to customize where they earn bonus cash back.
Rewards
- 5% cash back on prepaid airfare, hotels and car rentals booked through the U.S. Bank Rewards Travel Center
- 5% cash back on your first $2,000 in combined eligible purchases each quarter in two categories you choose. Eligible categories include cell phone providers; TV, internet and streaming; home utilities; fast food restaurants; gyms; ground transportation; furniture stores; sporting goods stores; select clothing stores; electronics stores; department stores; and movie theaters.
- 2% cash back on eligible purchases in your choice of one everyday category (like gas stations, grocery stores and restaurants)
- 1% cash back on all other eligible purchases
Welcome bonus
None
Annual fee
$0
Notable perks
The biggest benefit of the U.S. Bank Cash+® Visa® Secured Card is its generous rewards structure. Cash back earned with this card can be redeemed for a statement credit, a deposit to a U.S. Bank account (savings, checking or money market) or a prepaid U.S. Bank Rewards card.
The card also stands out for offering an unusually high security deposit limit of up to $5,000. Cardholders who spend within their credit limit and make on-time payments could eventually be upgraded to the U.S. Bank Cash+® Visa Signature® Card, at which time their security deposit will be returned.
Things to consider before getting a credit card after bankruptcy
There are a few things to keep in mind if you're thinking of applying for a credit card after you've filed for bankruptcy:
- You can't apply for any new form of credit until your bankruptcy has been discharged. A discharge occurs when you have officially been released of your obligation to repay certain debts. The discharge timeline depends on the type of bankruptcy you filed for.
- If you filed for Chapter 7 bankruptcy, it typically takes four to six months after you've filed for everything to be discharged. This means you'll have to wait four to six months to be able to apply for a new line of credit.
- If you filed for Chapter 13 bankruptcy, it could take a few years (usually three to five years) for your debts to be deemed discharged, so it'll be a couple of years before you can apply for a new line of credit. Otherwise, you can seek approval from the court to apply for a new line of credit before your debts have been discharged.
- Chapter 7 bankruptcy stays on your credit report for 10 years and Chapter 13 bankruptcy stays on your report for seven years, so lenders will see this when you apply for credit and they look at your credit report.
FAQs
What happens to your credit after you file for bankruptcy?
The impact of bankruptcy on your credit score depends on what your credit was like before filing for bankruptcy. Your credit score can drop after you file for bankruptcy, but in some cases, an already low credit score might actually increase after filing for bankruptcy because it clears away all other negative marks on your credit report.
Does bankruptcy clear all your debt?
Bankruptcy doesn't clear all of your debt. Bankruptcy can discharge medical bills, past-due rent and utility bills, credit card debt, car loans and even personal loans. However, certain debts, such as student loans, are not automatically discharged when you file for bankruptcy. If you've accrued debt due to criminal acts or fraud, that debt also won't be discharged.
How much will your credit score drop after filing for bankruptcy?
There's no exact measure for how much a bankruptcy filing will disrupt your credit score. According to debt.org, your credit score can drop by as much as 240 points if you had a really good credit score before filing for bankruptcy. If you previously had an average credit score, you might see less of an impact but can still watch your credit score plummet by as much as 150 points.
How fast can you rebuild your credit after filing for bankruptcy?
There is no set timeline for how quickly you can rebuild your credit score after filing for bankruptcy, but maintaining healthy credit habits is the best way to see your credit score improve over time. Making debt and bill payments on time and in full is one of the most important ways to improve your credit score. Keeping your credit utilization rate low can also help.
Bottom line
If you've filed for bankruptcy, applying for a secured credit card can be an impactful way to start rebuilding your credit score, especially since there are options on the market that cater to a variety of needs — including a credit card that doesn't even run a credit check.
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Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit card review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best credit cards.
Our methodology
To determine which cards offer the best value after filing for bankruptcy, CNBC Select analyzed 29 of the most popular credit cards available for consumers building or rebuilding their credit.
We compared each card on a range of features, including: annual fee, minimum security deposit, credit limit, rewards program, introductory and standard APR, welcome bonuses and foreign transaction fees, as well as factors such as required credit score and customer reviews when available. We also took into account how easy it is to upgrade the card from secured to unsecured and how quickly you can get your security deposit back.
Because it's unusual for credit cards aimed at consumers looking to build (or rebuild) their credit to have robust rewards programs, we did not analyze how many rewards points you can earn in the first year. For cardholders looking to rebuild credit, it's more important to practice good credit card habits — spending within your means, paying your balance on time and in full — than try to optimize your points balance.
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