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I am askin this question on behalf of a family member. They filed Chapter 13 and would like to know if they can start the rebuild process now or do they wait until they have received their discharge. If they start now, are there any creditors that they should try to establish accounts with?
Waiting until discharge is strongly recommended. Their attorney should have also advised them to do that.
Applying for new credit while still under bankruptcy protection without trustee approval can lead to dismissal of your case if the trustee (who isn't your friend) objects.
"No new credit without trustee approval" was exactly what my attorney told me. If the trustee says it's OK... go for it. Applying without informing the trustee is a risk I refused to take.
I rebuilt the profile you see in my sig without any problems at all... and I started the day after discharge.
She has received trutee approval for up to $500.00
@srloring13 wrote:She has received trutee approval for up to $500.00
So go for it then... just let her know that she should try to avoid garbage lenders like Credit One and First Premier.
Also, let her know that Rome wasn't built in a day. Rebuilding is a marathon... not a 100 yard dash. I'm 2 years into rebuilding since discharge... during which time my scores have went from 630's to 680's. I won't see 700+ until the public record and IIB accounts fall off my reports in the coming months.
A $500 CC is a nice start... just don't expect miracles with a credit score. She may also have difficulty getting approved with an open but not yet discharged Ch 13 on her reports as well... I went to buy a used car a few days after discharge in 2013 and ALL of the approvals I got were conditional on them seeing proof of my discharge due to the fact my reports hadn't yet updated.
Her best bet may be a secured card. As TRC mentioned, getting approved with an open BK is going to be difficult, however a secured card should be an option.
Thank you. I will pass the information along to her.