line of credit before discharge - Chapter 7

[ellis2156]

A local bank which is not included in the BK, wants to offer me a line of credit. Can you apply for a LOC before a chap 7 discharge? I am going to wait until after I receive my discharge, but was just curious if this was possible.

[keepmine]

Sure you can apply-getting approved may be a different story.

[DaisysMom]

BE CAREFUL!! I filed and a week later I started getting all kinds of offers for credit. Especially for cars and they were saying that there was some kind of advantage to getting the loan BEFORE my discharge???? I just shredded them all as they arrived. Afterall, I had just gotten out of the hamster wheel, why would I want to jump back in. I like it better right where I am. That's not to say that I might not need to finance a car in the future, but to do it just because I can....nada.

I must be honest though, I do have a couple of credit accounts with a couple of online clothing stores. (I need tall womens' and it is difficult to shop locally for jeans/slacks that don't look like floods.) But they only have a $250 limit and it's not a problem. And my using and paying them off is giving me a bump in my credit score because they both report my on time payments.

But as for bank credit lines and large limit credit cards.....those are in my past. May they rest in peace.

DM

[Pjmax]

I've heard that you can apply before discharge, not sure what the legalities of it are, but considering your credit reports and scores are going to be fluctuating until about a month after discharge, I can't see getting any decent rates until then, or better yet, after DC and you've had time to clean up your reports.

I watched my fako scores from just before filing, and they went from 500's to 400's to no score. I waited until about 1 1/2 months until my report monitoring settled down, checked my full reports and made sure everything was reporting correctly. I'm now 6 months out and my actual Ficos are high 600's.

Even if you can app and get credit now, it will be at the absolute worst terms and rates. If you can follow the right recovery steps, you'll be better off in the long run. One step at a time.

[ellis2156]

Thank guys for all the advice! Would you say 6 months after a bk discharge would be an appropriate time to get a secured card (just 1) to rebuild the credit?

[Pjmax]

The sooner you start adding something positive, the sooner you'll recover (or so I've read.) For a secured card, nothing wrong with getting one right after discharge. I've had a Capital One unsecured since less than 2 mos. from discharge and my scores improve every month.

For a secured, I would put as much as you can on it, the theory being 'bigger credit lines beget bigger credit lines.' I'm not an example of that, however. My CLs are not great, but they work for me.