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Chase Credit Cards After Bankruptcy
I write often about the negative effects of debt and how I believe people should take it slow. Debt creeps up pretty easy and sometimes life gets in the way as well. For some people, bankruptcy is inevitable.
Fortunately, for people who have worked to rebuild their credit after bankruptcy, there is still a possibility of getting premium rewards cards to earn free or discounted travel. Today I am going to talk about applying and getting credit cards from Chase with a bankruptcy on your credit.
How Long Does A Bankruptcy Stay On Your Credit Report
There are two main types of bankruptcies that consumers can file in the United States. Chapter 7 wipes away debt completely, while Chapter 13 requires the repayment of a portion of debts. They stay on your credit report as follows:
- Chapter 7 bankruptcies remain on your credit report for 10 years after filing.
- Chapter 13 bankruptcies remain on your credit report for 7 years after filing.
As you can see, bankruptcies stick around a lot longer than financial problems in many cases. Some people have 8 or 9 years of fantastic credit, but still get denied because of an almost decade old bankruptcy.
Fortunately there is some hope, but don’t expect to get premium rewards cards one or two years after emerging from bankruptcy. It takes time to reestablish yourself, but not quite as much time as the bankruptcy lingers.
The Chase Credit Card Application
Chase is the only bank that I am aware of who asks you point blank on the application whether you have a bankruptcy on your credit report. If you answer “yes” to this question, then you will receive an automatic denial without them even running your credit.
While it may seem counterintuitive, the correct answer to this question is “NO”. By answering no, you are ensuring that they will run your credit. Unfortunately, as soon as the system sees the bankruptcy, you will automatically be denied. (The application may go in process, but I know several people who have been in this situation and the application is always automatically denied because of the bankruptcy.)
Which Cards to Apply For?
Some Chase cards are more difficult to get than others. For example, business credit cards are generally much tougher to get, so I wouldn’t recommend applying for one if you have no other relationship with Chase.
The two big personal cards are the Sapphire Preferred and Freedom. Both require decent credit, although the Freedom’s requirements are much lower. Which card you apply for is going to be a personal decision based on your situation.
I highly recommend doing research before applying. One good resource for finding out requirements is the myFICO forum. While I can’t assess your chances of success since everyone’s situation is different, I can say it is possible to get any Chase card with a bankruptcy on your credit. Other factors combined with the bankruptcy may stop it, but not the bankruptcy alone.
Fortunately Chase has a pretty good reconsideration department who is empowered to assess your application based on its merits. If you have established many years of good credit history after a bankruptcy, they may want you as a customer. Don’t be discouraged.
Chase reconsideration numbers can often be hard to find, but this Flyertalk thread usually has up to date information. While you certainly can wait before calling, it doesn’t hurt to call immediately after submitting the application.
I have found that Chase reconsideration representatives are among the friendliest around. They always seem helpful and genuinenly willing to help. I suggest starting the call by informing them that you are checking on your application status.
Normally they will look up the application and inform you that it has been denied because of a previous bankruptcy. At that point ask if the application can be reconsidered. They should say “yes” and then begin asking you a few questions.
During the reconsideration process be prepared to share the reason for your bankruptcy. While I always feel it is important to tell the truth, make sure you emphasize the positives of your situation and try to downplay the negatives.
One of the best things you can do is remind them over and over of all the good credit you have established since the bankruptcy. They have your credit report in front of them, so mention specifics. Showing you are knowledgable about your own credit can go a long way.
Finally, emphasize how you want to begin a relationship with their bank. It may not hurt to mention that you aren’t looking for a large credit line either, but rather a chance to prove yourself. In the end, if you have decent credit, are polite on the phone and properly make your case, you should be approved.
Chase does seem to have a policy at the application level of automatically denying applicants who have a bankruptcy on their credit report. Fortunately, they also have an empowered reconsideration team who is friendly and helpful.
If you are someone who has spent years with some of the less attractive credit cards out there and want to step up to some of the premium rewards cards, it may be possible. It is definitely a long road back from bankruptcy, but it doesn’t have to be quite as long as you think.
Miles to Memories has partnered with CardRatings for our coverage of credit card products. Miles to Memories and CardRatings may receive a commission from card issuers.