We get this question all the time: “How soon after a bankruptcy can I apply for lines of credit?” Out of one debt hell into another? Maybe you should examine the reason why you’re filing bankruptcy? Ok, we’ll avoid the lecture and just answer the question.

Primarily, how long you need to wait to apply for new credit depends on the credit for which you are applying.

Secured Lines of Credit (the loan is tied to an asset like your house or car)

• Mortgages “A” credit: 4-5 years (FNMA just changed its guidelines to 5 years)
• Mortgages less than “A” credit:
  • Hard money loans (50% down, 6 month balloon)- immediately. You do not want this kind of loan, it’s basically loan sharking
  • “Sub-prime” credit offerings: 1 year or more. (add 2-3% over “A” paper)
  • “A-” credit offerings 2+ years. These are not quite “A” paper, add 1% over FNMA rates.
• Auto loans Similar time line for types of loans. I suggest a credit union if you have less than perfect credit.
• Credit Cards (secured cards): immediately, unsecured cards, some credit unions will give you an unsecured card if you have 2+ years of good credit history after the BK
• Credit Cards, (Unsecured) until the BK comes off Examples of these types of cards are American Express and Discover

And need we say it? The timeframes given above assume that you have PERFECT credit (no negatives at all) since the BK. For more info and current rates try these links on bankrate monitor:

• Mortgage rates
• credit card rates
• auto loans

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