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Can I Keep Some of My Credit Cards Out of Bankruptcy? – Jessy

“Dear Steve,

I have about $50k consumer debt spanned over 3 credit cards; As per a previous advice from you – as a response to a detailed email of my situation – I am very strongly considering bankruptcy and already contacted an attorney and started collecting the forms (tax return, bills etc) I would need.

My question is this: the debt I have is on three credit cards; the one with the highest minimum payment, Bank of America, I have stopped paying 3 month ago, while still paying the minimum on the other two – Chase and HSBC. Other than those three cards I have additional cards (US Bank personal and business, Citi MC, Amex Blue and Optima) – all being paid in full when used. Is there any way for me to keep some/any of the credit cards I don’t owe on while going through bankruptcy? Is it possible to ask those companies to, maybe, not let me use the cards while going through the process but once back on my feet to reactivate them so I can maintain the long perfect history?

Once back on my feet I certainly don’t want to have that many cards but wouldn’t mind to keep Citi – which I’ve had the longest since the mid 90’s, to keep one Amex (have had Optima for almost just as long), and maybe keep the US Bank business (freelance real-estate, photography and IT).
Your advice would be very greatly appreciated!!!

Thanks,
Jessy”

Dear Jessy,

You can carry a credit card through bankruptcy as long as it has a zero balance when you file. However it will have to be listed in your bankruptcy since it is credit in your name.

However, don’t be surprised if American Express will close all of your accounts regardless. The other zero balance accounts will probably be happy to keep you as a customer. The issue is that many agreements say the agreement may be cancelled if the cardholder files bankruptcy. American Express has traditionally been jerks about this while other banks historically have kept the cards open.

Keep going with the filing and let me know what happens.

Sincerly,
Steve

You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.




About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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