Can You Get A Credit Card While In Chapter 13?

Wondering if it’s even possible to get a credit card if you’re in Chapter 13 bankruptcy? 

Bankruptcy can feel like your financial world just flipped upside down, and adding a credit card into the mix might sound impossible. 

But guess what? It’s actually not.

Now, it’s not going to be as easy as walking into a bank and getting instantly approved. There are a few hoops, some rules, and some patience involved. 

In this post, we’ll show you how to get a credit card while in Chapter 13.

Can You Apply For A Credit Card During Chapter 13?

Yes, you can get a credit card while you’re in Chapter 13 bankruptcy, but you need approval from the trustee or the court first.

Chapter 13 puts your finances under the supervision of a bankruptcy court and trustee. Because of that, you can’t just run out and open new lines of credit without permission.

Also Read: How Long Will Chapter 13 Delay Foreclosure?

Most credit card companies aren’t eager to give out unsecured cards to someone in the middle of bankruptcy. From their point of view, you’re high risk. 

Plus, the court has rules that limit you from taking on new debt without approval. 

So while you can apply for a credit card, you’ll likely face two big hurdles: 

• Getting a lender to approve you
• Getting the trustee’s okay to even try

Secured Credit Cards As An Option

A secured credit card works differently than a regular card. Instead of being approved based on your credit score, you put down a cash deposit, usually the same amount as your credit limit. 

For example, put down $300 and you get a card with a $300 limit.

Because you’re essentially borrowing against your own money, banks see this as less risky. 

That makes secured cards the most realistic way for someone in Chapter 13 to get back into the credit game. 

Courts and trustees may allow this since you’re not piling on new debt in the traditional sense. It’s more like showing that you can handle credit responsibly again.

The big advantage is that secured cards report to the credit bureaus just like normal ones. 

Use them responsibly, pay on time, and your credit history starts to improve.

When Unsecured Cards Might Be Possible

Now, it’s not impossible to get an unsecured credit card during Chapter 13 – it’s just harder. 

Some smaller lenders, credit unions, or companies that specialize in “bad credit” cards might be more open to giving you a shot.

But there’s a catch (of course). These cards can come with high fees, crazy interest rates, or super low limits. If you’re not careful, you could actually end up hurting your credit even more. 

So if you do go this route, read the fine print like your life depends on it.

Also, again, you’ll need court or trustee approval first. 

Once your repayment plan is complete and the court officially closes your case, you’ll start to see more opportunities. Lenders view you as less of a risk because you’ve shown you can follow through with payments. 

That’s usually when unsecured card approvals become realistic again.

Also Read: Chapter 13 Payment Plan Example

How To Get A Credit Card During Chapter 13

If you’ve decided you want to try for a card while still in bankruptcy, here’s the basic roadmap:

#1 Talk To Your Bankruptcy Attorney

Seriously, this should be your first move. 

Your attorney knows the details of your case, your repayment plan, and your local court’s rules. They’ll tell you if it’s even worth applying right now or if you should wait a bit.

Also, they can help with the paperwork you’ll need to submit to the trustee or court. 

Trying to figure all that out solo can be a headache, and honestly, they’re there for exactly this reason.

#2 Get Trustee Or Court Approval

Once you’ve got your attorney on board, it’s time to get official permission. 

Depending on your case, this might involve a formal request to the bankruptcy court or just a quick approval from your trustee.

They’ll look at your budget and repayment plan and decide if a new credit card fits into that. 

They’re mostly checking that this won’t derail your financial progress. If it looks solid, they’ll usually say yes.

Also Read: Does A Chapter 13 Trustee Monitor Income?

#3 Explore Secured Card Options

Now comes the fun part: shopping around. 

There are lots of secured credit cards out there. Look for ones with:

• Low (or no) annual fees
• Reporting to all three major credit bureaus
• A refundable deposit
• Decent reviews from real people

Don’t rush this. You want a card that will help you build your credit, not drain your wallet.

#4 Apply For The Card

Once you’ve found a good option and gotten your approval, go ahead and apply. 

This part is usually pretty simple. The card issuer will likely do a credit check and may ask about your income or employment. Be honest.

If you’re approved, you’ll send in your deposit, and they’ll mail you the card.

#5 Start Small And Use Responsibly

Once you’ve got your card, don’t go on a shopping spree. Just use it for small things like a coffee here, a gas fill-up there, and pay it off in full every month.

You don’t have to carry a balance to build credit. 

In fact, it’s better if you don’t. Just show that you can borrow a little and pay it back on time. That’s what lenders love to see.

Also, keep an eye on your credit score. 

You should start to see small improvements over time. It’s a slow climb, but every point counts.

Bottom Line

Getting a credit card during Chapter 13 isn’t impossible, it just takes a lot of patience. 

A secured card is usually your best bet, and it can be a powerful tool for rebuilding. Unsecured cards are rarely available until after your case wraps up, and even then, they may start with higher rates or lower limits.

If you’re serious about getting a card during your plan, always talk to your attorney and trustee first. From there, take small steps and use the opportunity wisely.