Can I Apply For Credit While Bankrupt?
Filing for personal bankruptcy does not prevent you from applying for credit however as a bankrupt person you have a duty not to engage in any business transactions, or obtain credit of more than $1,000, without disclosing to the other party(ies) that you are an undischarged bankrupt. This could result in the lender not granting you credit or they may require a co-signer and/or charge you a higher rate of interest to offset the risk of lending to you.
If your intention is to start rebuilding credit, you may want to apply for a secured credit card. As long as you apply for a limit under $1,000 you are not required to disclose that you are bankrupt, however, the lender will likely find out by pulling your credit report.
Note: Renewing your mortgage is not considered an application for new credit so there are no restrictions as long as you are not attempting to borrow additional funds.
Once your bankruptcy is complete and you have received a discharge, you are free to apply for credit without any restrictions.
Powell Associates Ltd. is a Licensed Insolvency Trustee (LIT) focused on providing debt settlement, proposal and bankruptcy solutions for individuals and businesses. We offer free consultations to review your personal financial situation and practical debt resolution options. Contact us to discuss your situation over the phone or book an appointment to meet us face-to-face in Saint John, Moncton, Fredericton, Charlottetown or Dartmouth - it's your choice.