After your bankruptcy, one of the last things you probably want to see is another credit card. Or you may be worried that no company will ever offer you another one, and you want to take the first offer that comes along. Whatever your feelings about credit, you will most likely need to rebuild your credit history if you ever plan on purchasing a home or car again. Used correctly and responsibly, credit cards can be a great tool to help with rebuilding your credit.
There are some things to be careful of when looking for a new credit card or if you have received an offer in the mail. One rule of thumb: if it sounds too good to be true, it probably is. Another: ALWAYS read the fine print.
Many companies market to newly bankrupt people. They know you want to rebuild your credit and may pay large fees to get a credit card, thinking your fee is a deposit on their secured card. They offer you a “guaranteed” line of credit, or promise that “you cannot be turned down”, but what you end up with for your $100 or more is a LIST of companies that MAY give you a secured credit card. You can get that for free yourself at www.bankrate.com. Don’t give them your hard earned money.
There are also companies that offer a credit card, but it is a merchandising ploy and can only be used to purchase their overpriced merchandise. One example is a card offered by USA Platinum through CMG, also known as All American Gold. The fine print even tells you it is NOT a Visa or Mastercard. There is typically an enrollment fee to become a “member” with these type of scams.
Beware of companies offering to automatically deduct your payments each month to “help you rebuild your credit with timely payments”. That puts them in charge, which is never a good idea. Other companies invent a name which closely resembles a legitimate and familiar bank name. They are trying to confuse you.
Some companies require an up-front membership fee before you even find out what the interest rate will be. Get the rate in writing first. And check out the bank affiliation — genuine cards will always have an affiliation from an issuing bank.
The bottom line is, do your homework, call the Better Business Bureau, and ALWAYS read the fine print. There are many scams and people just waiting to take your money.
About admin
