If I File for Bankruptcy in Arizona, Can I Keep One of My Credit Cards?

answerAnswer: If you owe any money on a credit card at the time you decide to declare bankruptcy in Phoenix and other parts of Arizona, you must list the credit card as a debt on your bankruptcy declaration.

Please note, the bankruptcy schedules are filed under penalty of perjury: if there is perjury in connection with your bankruptcy it can lead to the denial of discharge of all of your debts. Perjury in this case is a federal crime! Do not take it lightly, it is a serious offense. We don’t believe that it is worth reaffirming your credit card debt during your bankruptcy filing.

Once you are through with your bankruptcy, you will have ample credit cards wanting your business. You will be able to get a credit card quickly.  Our experienced bankruptcy lawyers will guide you every step of the way through the bankruptcy filing process.

The exception to the rule.

The exception to not including your credit card in your bankruptcy is you don’t have to include any credit cards if you have a zero balance on your credit card when we file your bankruptcy. Note, however, your credit card company may find out through other means that you are filing for bankruptcy and cancel your credit card as a precaution. Additionally, they could raise your interest rate on your credit card even though it has a zero balance. Capital One, CitiBank, and American Express are notorious for doing things like this to their clients no matter how long you have been a faithful holder of their card.

Reaffirming a credit card.

Credit cardsMost credit card companies will want you to keep their credit card for use after bankruptcy. They will do this for you if you agree to reaffirm the balance on their card and enter into a new agreement, signed after the bankruptcy filing. Which means, Yes, you will have the use of their credit card after your bankruptcy but you will also have debt coming out of your bankruptcy. It is easier and probably a better course of action to include all of your credit cards in your bankruptcy declaration.

Reaffirming a particular credit cards debt would be one way that you could still have a credit card after filing for bankruptcy, we feel that this is often a very bad idea. Once you reaffirm their debt, the credit card company can, cancel your card or raise the interest rates on your card once you have completed your final payment to them.

As a rule, The My AZ Lawyers never recommends that you reaffirm a credit card unless it is an absolute necessity for your business to survive. The reaffirmation decision is up to the credit card company. The credit card companies are not your friends. Most credit card companies want to avoid the loss incurred when the debt is discharged by you filing bankruptcy. The credit card companies will want your future business. Bottom line, the credit card company wants their money from you!

If you have questions about the bankruptcy process in Arizona, we welcome you to contact one of our knowledgeable bankruptcy lawyers in Phoenix, Mesa, Glendale, Tucson or at any of our regional offices in Arizona and schedule a free initial consultation with an experienced attorney.

We also provide free consultations over the telephone. Give us a call. (480) 833-8000 or Send us an e-mail. Don’t you deserve a Fresh Start?

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