Included in Bankruptcy (IIB) Or Not – How to Get Back In With Lenders After Bankruptcy
One topic you will often see come up after filing for Bankruptcy and rebuilding your credit is whether you included an individual lender in your bankruptcy filing. This is often referenced by the abbreviation IIB (Included in bankruptcy).
Let’s use an example to make this easy to understand. If you had a Chase credit card that you built up a large balance on and eventually you filed bankruptcy, then Chase would be Included in Bankruptcy (IIB). It doesn’t matter what type of credit card it was – a Chase Freedom, Reserve, Preferred, or even one of their branded cards such as the Hyatt Chase card or the IHG Chase card. If any of these cards had a balance on them, then you included Chase in your bankruptcy filing.
This is actually a very big deal. Any lender that you include in your filing means that you will usually have a very difficult time getting another credit card or loan from them again. Let’s take a look at what certain lenders usually do:
American Express –What Are Their Rules After Including Them In Bankruptcy?
This is one of the hardest lenders to EVER get a credit card or charge card from again if you bankrupt out of an obligation you had with them. American Express typically bans you for LIFE! This includes being an authorized user on any card. If you have built up a balance on an American Express card, one good strategy can be to pay that card off and then close all of their cards BEFORE you file for bankruptcy. Remember you can only do this if your bankruptcy is a long time away! You cannot pay them off right before you file for bankruptcy. Just keep in mind that if you bankrupt on AMEX, you will be gone for life.
Chase- How Do You Get Back In With Chase After a Chapter 7 Bankruptcy?
– Another very difficult issuer if you include them in a bankruptcy. Chase will usually wait until the bankruptcy is off your credit report before giving you another chance. You are looking at 7-10 years before getting back in with Chase. The good part about Chase is that you can still become an authorized user on their cards. If you have a spouse then this is a great way to keep generating strong rewards points for your family. There are some reports of people being able to get back in with Chase while the bankruptcy is still reporting, however you will definitely need to call Chase after you apply and plead your case. The more time that passes with Chase the more of a chance you will have.
Citibank – How Do You Get a Credit Card with Citi After Bankruptcy?
Citi is also known for being hard on people who included them in bankruptcy. Expect to wait 4+ years to even have a shot, and you’ll most likely need to wait until the bankruptcy is off your record. A good follow up phone call to their reconsideration department may help here, but you’ll need to be good at pleading your case.
Capital One – The Number One Credit Card Company After Filing Bankruptcy?
Now let’s talk about the #1 card issuer for those who have previously filed bankruptcy! I owed over $50,000 to Capital One and bankrupted out of that entire amount. They took what was seemingly a big loss on my account. (However, if you add up all the interest charges I paid them and all the processing fees they generated on me over the years, the loss wasn’t nearly as big!) Within 1 year of being discharged from bankruptcy, I was bank in with them with their top tier Capital One Venture card with a credit limit of $20,000! This is truly hard to believe, but Capital One is the most lenient mainstream issuer of credit. What’s the best credit card issuer to go with after bankruptcy? It is for sure Capital One. You’ll see that my general recommendation is to avoid the shady credit card issuers and instead start with a good Capital One card with no annual fee, like their Platinum card. My suggestion is to use a debit card until you can get this after bankruptcy.
There are many more issuers all with their different rules and regulations. Keep in mind as well that there are always exceptions to any rule. If you bankrupted out of a small amount on one card you’ll have a better chance of getting back in with many issuers.
Keep all this in mind if you are planning to file for bankruptcy. I would absolutely pay off Amex and close their cards a long time before you file if it is at all possible. Obviously if you have run up large charges with them you’ll probably be stuck, but consider it as part of your overall bankruptcy strategy with your attorney.