A bankruptcy claim is seen by most people as one of the worst possible financial situations and something that will haunt them, their credit history and credit report forever.
In truth, personal bankruptcy saves many people’s financial situations and there are banks out there which can be considered bankruptcy-friendly. You may have to start with baby steps, but you can get on the road to improved credit nonetheless.
People who have declared bankruptcy can take comfort in the fact that there are bankruptcy-friendly banks out there.
How Bankruptcy-Friendly Banks Work
After bankruptcy credit takes a nosedive. These banks seek to help people build their credit back up by extending small, secured lines of credit. These lines of credit are smaller and more secured (i.e., require more of your money or collateral as a deposit) depending on how recent your bankruptcy filing was.
For example, if you declared bankruptcy six months ago, a bankruptcy-friendly bank might give you a secure credit card around $500. If you declared bankruptcy one year ago, you might get a secured card for $1,000.
The more time you have under your belt since you first declared bankruptcy, the more favorable your rates and credit lines will be.
How to Find a Bankruptcy-Friendly Bank
Finding a bankruptcy-friendly bank is easy to do online, but you really need to be alert before you sign anything or enter into any sort of a financial relationship with one of these banks.
Some may claim to be willing to help you, but charging you outrageous interest rates with outrageous terms. In a word, these banks are both predatory and mercenary, in that they see you as more helpless due to your bankruptcy and will seek to profit from your compromised circumstances.
Before you seek out bankruptcy-friendly banks, be sure to consult with a bankruptcy credit counselor. Better still, consult with any of the many consumer-advocacy groups out there who seek to protect people like you from predatory lenders. After all, there is a good chance those lenders got you into trouble in the first place.