Getting a credit card after bankruptcy discharge in Canada

You have a good chance of qualifying for a credit card after bankruptcy discharge if you take the necessary steps to improve your credit score and your overall financial health. Learn more about how you can get a credit card after bankruptcy and compare the best credit cards that accept bankruptcies in Canada to find the best fit.

Compare credit cards after bankruptcy in Canada

When looking for credit cards after bankruptcy discharge, you’ll ideally want to get a a credit card that can help build up your credit score again. However, there are a couple of other options if you’re having trouble qualifying for typical cards.

Secured credit cards after bankruptcy

Looking for the best secured credit cards after bankruptcy? This is the best place to start. Secured credit cards require you to put down a security deposit which serves as your credit limit. This security deposit also acts as collateral for your credit card provider in the event you miss payments. If you use your secured credit card responsibly and make your repayments on time, you should see your credit score start to increase after a few months or years (depending on the state of your score when you get started).

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Name	Product	Welcome Offer	Rewards	Purchase Interest Rate	Annual Fee		Min. Credit Score	Description
Neo Secured Card Neo Secured Card		15% cash back	5% cash back	19.99% - 26.99%	$0	Apply now More Info	Min. recommended credit score: 600	Earn bonuses like 15% cashback on your first purchase at most partners, and earn an average of 5% cashback at thousands of partners and at least 0.5% cashback guaranteed.	Compare	loading Fetching your data...

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Credit cards after bankruptcy that won’t build credit

These credit cards don’t help you build credit but they’re very easy to qualify for and can be a good option if you’re having trouble getting approved for a regular or secured credit card.

1. Prepaid cards after bankruptcy

Prepaid cards can be a good option if you want the convenience of shopping online but aren’t able to get a regular credit card. These cards can be reloaded with money from your bank account as needed, and you can use them wherever Mastercard or Visa are accepted. Just be aware that these cards tend not to come with additional rewards or benefits.

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Name	Product	Monthly Fee	Cost per transaction	Foreign transaction fee	Rewards	Feature
EQ Bank Card EQ Bank Card		$0	$0	0%	2.50% interest, 0.5% cash back		Get 2.50% interest on your money and get 0.5% CashBack on every purchase.	Go to site More Info	Compare	loading Fetching your data...
CIBC AC Conversion Visa Prepaid Card CIBC AC Conversion Visa Prepaid Card		$0	$0	0%	1% cash back		Load up to 10 different currencies with 1 card, earn 1% cash back on all spend and avoid fees.	Go to site More Info	Compare	loading Fetching your data...
OFFER KOHO Easy Prepaid Mastercard KOHO Easy Prepaid Mastercard	OFFER	$0	$0	1.5%	1% cash back	Use promo code FINDERCODE and receive a $20 cash bonus into your KOHO balance once you make your first purchase within 30 days of signing up.	Earn 1% cash back on groceries, billing and services. Plus, earn 0.5% interest on your entire balance.	Go to site More Info	Compare	loading Fetching your data...
OFFER KOHO Extra Prepaid Card KOHO Extra Prepaid Card	OFFER	$9/month or $84 annually	$0	0%	Up to 2% cash back	Use promo code FINDERCODE and receive a $20 cash bonus into your KOHO balance once you make your first purchase within 30 days of signing up.	Earn 2% instant cash back on groceries, eating and drinking and bills and services, and 0.5% cash back on all other purchases. Plus, earn 2.00% interest on your entire balance.	Go to site More Info	Compare	loading Fetching your data...

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2. Visa Debit or Debit Mastercard

Getting a debit card that’s affiliated with a credit card provider is an easy way to get the convenience of a credit card without needing to qualify for one. Most big banks and credit unions offer Visa Debit cards and Debit Mastercards for no additional cost. Just be aware that you won’t typically get rewards or benefits included with these types of cards.

What is bankruptcy?

Bankruptcy is the process of legally declaring that you can’t repay your debts. You will have to sign all of your assets over to a licensed insolvency trustee, who will then discharge you from paying back the money you owe. Once you’ve filed for bankruptcy, creditors can no longer garnish your wages or contact you in an effort to collect debts.

A licensed insolvency trustee is the only professional who can deal with bankruptcy in Canada. These specialized lawyers are federally regulated by the government to help make the cost of bankruptcy more reasonable. Just be aware that filing for bankruptcy won’t necessarily eliminate all of your debts and your credit score will decrease dramatically when you file.

Can I get credit cards after bankruptcy discharge?

You can definitely apply for credit cards after bankruptcy discharge but you may be rejected if your bankruptcy still shows on your credit report. Until you can qualify for a regular credit card, you may want to apply for a secured credit card to build your credit while you spend money. This will make sure your credit score is in decent shape when your bankruptcy ends.

You may also want to consider rebuilding your credit without a credit card. For example, you could take out a credit builder loan or apply for a bad credit car loan to increase your credit score. You could then take out a Visa Debit or Debit Mastercard with your bank or sign up for a prepaid card to enjoy the convenience of a credit card without needing to qualify.

What to do before you apply for a credit card after bankruptcy

There are a few things you can do before you apply for post bankruptcy credit cards in Canada to make sure you’re in the best position to qualify:

1. Request your credit report. You’ll want to know what your credit score and credit report look like before you apply for a credit card. You can request a copy of your credit report for free from one of Canada’s main credit bureaus, Equifax or TransUnion. Once you know your score, you’ll be able to figure out which cards you can apply for.
2. Correct any errors on your credit report. Go through your credit report with a fine-toothed comb to make sure that there are no errors that could be bringing your score down even further. If there are, you can report them to the credit bureaus to have them corrected.
3. Call your credit card provider. You may want to call your credit card provider to find out how it handles clients with bankruptcies. You can ask about the minimum credit score requirements you’ll have to meet to qualify for the card of your choice, and see if they make exceptions for approving bankruptcies in certain situations.

How to apply for credit cards that accept bankruptcies in Canada

You can follow these steps to apply for after bankruptcy credit cards in Canada:

1. Figure out which credit card you want. Compare credit cards after bankruptcy from a number of providers to find the one that best suits your personal situation.
2. Make sure you meet eligibility requirements. Double check that you meet income requirements and credit score criteria for your chosen credit card before you apply.
3. Apply for the card of your choice. Apply for the credit card of your choice by visiting the main site of the provider you’re interested in.
4. Fill out application details. Fill out personal details such as your full name, address, email and phone number to start your application.
5. Authorize a credit check. Submit to a personal credit check to see if you can get approved for the credit card of your choice.
6. Click submit. Once you’re ready to apply, click submit on your application or call your credit card provider to apply over the phone.

What to do after you receive your credit card

The tips below can help you to manage your credit card responsibly after you’ve been approved for a credit card:

• Make your repayments on time. You’ll need to make all of your payments on time to build your credit score. It can help to set up automatic payments from your bank account or set up a monthly reminder on your phone to make sure you don’t miss a payment.
• Pay your card in full each month. You can save money on interest and avoid your balance getting too big if you simply pay the amount you owe off every month. This can help you rebuild your credit and make sure you don’t get sucked into another cycle of debt that’s difficult to get out of.
• Avoid using your card for cash advances. Try not to take out cash advances using your credit card since these often come with higher interest rates and can be difficult to pay off. If you need emergency cash, you may be better off looking into a bad credit loan (as long as the APR for that loan is below 22.99%).
• Keep your card balance below 30% of your credit limit. Spend only a portion of your allowable credit limit each month to show the credit bureaus that you’re in control of your spending. This can help to increase your credit score as well.
• Don’t pay your credit card off with borrowed money. Avoid paying down your credit card debt with other forms of debt such as payday loans or cash advances from other credit cards. This is because your interest payments can quickly get out of hand, leading you to spiral into more unmanageable debt.

Alternatives to credit cards after bankruptcy

If you’re ineligible for a credit card, you may be able to get access to fast cash or build your credit score with the following products:

• Bad credit loans. Some lenders may be willing to grant you a personal loan despite your bad credit history. However, make sure you compare the interest rates and fees before you apply.
• Payday loans. Payday loans can give you access to fast cash but come with extremely high fees and usually have to be paid back within two weeks. You should avoid using these types of loans wherever more affordable options exist.
• Bank overdrafts. You may be able to get a personal overdraft from your bank if you have a long standing relationship with it. You can reach out to your bank to find out how to tap into your overdraft and learn more about what fees you’ll have to pay.

Other factors that affect your credit card application after bankruptcy

Credit card issuers weigh a range of other factors before approving or denying your request for credit. These include the following:

• Income requirements. Most credit card companies specify the minimum annual income you’ll need to make to apply for a credit card. You may not be able to qualify for more premium credit cards with a lower income, while most basic credit cards require you to make at least $12,000 per year.
• Employment status. You may be required to show proof of employment to qualify for some after bankruptcy credit cards. In this case, you could show letters of reference from employers or pay stubs. Many credit card companies won’t approve applications from people who don’t have secure employment, even with a decent credit score.
• Other financial information. Each credit card issuer will have its own process to evaluate the risks involved in lending to you. Your bankruptcy will certainly be assessed along with your history of missed payments. Your provider may also ask for information about your current debts or assets.

Bottom line

You can apply for many different types of credit cards after bankruptcy, with the most common type being a secured credit card to rebuild your credit. Find out more about the options available for credit cards after bankruptcy and explore suitable alternatives to rebuild your credit or get the cash you need if you’re having trouble qualifying for the card of your choice.

Bankruptcy credit cards FAQs

• How can I improve my chances of qualifying for after bankruptcy credit cards?

  Your best bet to qualify for a credit card after bankruptcy is to apply for a secured credit card. Aside from taking out a secured card, you can also focus on doing everything you can to improve your credit score so that the banks see you as a less risky borrower. Here's a guide to credit cards that help you establish credit.

• What are the best secured credit cards after bankruptcy?

  The best secured credit cards after bankruptcy for you will depend on your personal situation. However, some solid choices for the best secured credit cards after bankruptcy include the Refresh Financial Secured Card, the Home Trust Secured Visa or the Capital One Guaranteed Secured Mastercard.

• What happens if I can't get approved for credit cards after bankruptcy?

  Other than applying for secured credit cards, one good option is to focus on rebuilding your credit with a dedicated credit-building program such as the Marble Financial Score-Up program. This program uses algorithms to help you set a target credit score and devise an action plan to achieve this score. It can also help you identify problem areas on your credit report so that you're not being penalized when you shouldn't be.

• Are there any after bankruptcy credit cards that can help me with my credit score?

  Yes, a secured credit card can help you build your credit. These credit cards require an upfront deposit that also serves as your credit limit. Your credit card provider can use this deposit to pay off your outstanding balance if you default on your payments. Any on-time payments you make will be reported to the credit bureaus to help build your score.

• I have a lot of debts. Should I file for bankruptcy?

  Every financial situation is different, and whether bankruptcy is the best choice for you depends on a number of factors. There are a lot of reputable financial counselling services out there that can help you make a suitable and informed decision.