Credit And Bankruptcy

Bankruptcy Lawyer Discusses The Effect of New Jersey Bankruptcy on Credit and the Authorized User

An authorized user is permitted to use a credit card without having any obligation to pay the debt. This means that only the individuals that have signed the credit card documents, as the responsible party, may be sued if the debt is in default. An authorized user may be included at the time the responsible party signs the application or anytime thereafter, without a credit check.Typically, the responsible party and not the authorized user receives the credit card monthly statements and correspondence. Consequently, the authorized user may not be privy to the credit card information,including the status of credit card payments.
The status of the credit card will affect the Authorized users’ credit and credit score, even though he is not responsible for making payments. If the payments are current, the authorized user’s credit will be favorably effected. However, if the payments are in default, the authorized user’s credit will be negatively effected. Also, the filing of a bankruptcy case by the responsible party will negatively affect the credit score of the authorized user. Therefore, it is extremely important for the authorized user to be added to the account of a very responsible person.
The credit card company will continue to report the status of the monthly payments for the authorized user, until the authorized user is removed from the account. If the authorized user is aware, that the payments are not paid on a timely basis, he should remove himself from the account, for the purpose of stopping any future negative reporting. The authorized user should remove himself from the account, prior to the bankruptcy filing of the responsible party. As a result, the filing most likely will not be reported on the authorized users’ account.
One strategy for repairing credit after a New Jersey bankruptcy filing, is to add oneself as an authorized user, to an existing established credit card that is held by a very trusted individual. Also, one can include themselves to a new credit card as the responsible party or authorized user, with a very trusted individual.
The Law Offices of Robert Manchel may be contacted at 866 503 5644 to discuss your New Jersey bankruptcy options.

Many clients advise me that they only want to use cash and will never use credit cards, again, after bankruptcy. However, in the U.S. economy it will likely be necessary to use credit for various needs. In other words, you may need credit to buy an automobile or other essential items. Therefore, the better your credit worthiness the lower your interest rates and the cost of credit.
Also, please note that a high credit score does not necessarily mean that you are a good credit risk. For example, a person with a high credit score, with tons of debt and a very low paying job, may not be a good credit risk.
After a bankruptcy case is completed and the debtor has been granted a discharge, the debtor must obtain their credit report from all three credit bureaus- Experian, Equifax and TransUnion. The credit report must reflect that all dischargeable debt is marked as discharged. The debtor may need to wait some time after their discharge for their credit report to accurately reflect the bankruptcy discharge. If their credit report is not properly reflecting this information, the bureaus must amend the credit report accordingly. In the event the credit report is not properly reflecting this information after a reasonable time period, one should send a letter requesting the change to all three bureaus with the discharge order enclosed. Also, a copy of the letter should be sent to the creditor.
Also, after the discharge, the debtor should obtain a secured credit card from a bank. My explanation of a secured credit card is in a separate blog. After making timely payments in connection with your secured credit card, the individual should apply for additional credit cards from other banks. All monthly credit card payments should be current and up to date.
You may contact Robert Manchel, NJ bankruptcy attorney, for a free consultation, at (866) 503-5655. We can discuss your individual circumstances and whether bankruptcy protection is an option for you.

Believe it or not, at about the time a person obtains a New Jersey bankruptcy discharge, he will likely receive numerous mail solicitations for credit cards. The solicitation proposals are very costly and do not substantially benefit your credit. Such credit cards offer very high charges, with very high interest rates and very low limits.
A secured credit card is a credit card issued by a bank that is connected with a money deposit in the bank. The credit limit on the card is, typically, no more than the amount that must be maintained in the bank account. For example, the bank will require a $1,000.00 deposit, for a credit limit of $1,000.00 or less. The bank will extend credit to someone to whom they would typically not extend credit because they are protected by holding the amount that someone borrows. There is very little risk for the bank.
Typically, the best way to improve your credit score is to establish a secured credit card account. Although the qualifications for a credit card approval is different for each bank, typically all banks will not approve someone for such a card until they have received a bankruptcy discharge. This means that the bankruptcy case must be totally completed before receiving the card. Some banks will approve a person for a secured card immediately after the completion of a case and others require a year after the bankruptcy completion.
After a person continues to make timely payments on the card for some time, his credit will improve. Thereafter, another bank may approve this person for a conventional credit card based on the established timely payments. This process will improve your credit and your ability to obtain future credit.
Robert Manchel is a NJ bankruptcy attorney that is available to answer your questions about how bankruptcy affects your credit, at (866) 503-5655.

A New Jersey bankruptcy clearly has a negative impact on your credit score. In other words, a bankruptcy filing will definitely reduce one’s credit score. The lower one’s credit score at the time of the filing, the less the bankruptcy filing will impact a credit score. However, typically after a bankruptcy discharge, a person’s credit worthiness increases substantially.
The basics of one’s ability to obtain credit with a low interest rate is virtually common sense. What does a prospective creditor look at to determine whether a creditor will lend money and the amount that will be lent? Typically, they will consider the borrower’s income, debt, expenses, credit score, and assets. A credit score is only one criteria that is considered. Someone with an excellent credit score with a ton of debt and a low paying job, is typically not a good candidate for a loan.
After a bankruptcy discharge, a person can rebuild their credit score with some easy strategies.
You may contact Robert Manchel, experienced NJ bankruptcy lawyer, at (866) 503-5655, to discuss how bankruptcy will impact your credit and how bankruptcy protection may apply to your personal situation.