"I want to keep a credit card for emergencies". I hear this frequently from Chapter 7 clients.

Edrie Pfeiffer
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Edrie Pfeiffer, Bankruptcy & Divorce Attorney

A question that comes up frequently when discussing a Chapter 7 Bankruptcy with clients is if they can keep a credit card and not list it in their bankruptcy. I understand the desire to have a credit card for emergencies. However, the bankruptcy code requires that you list everyone that you owe money to. There are no exceptions. Even debts that will not be wiped out, or discharged, must be listed.

In addition, you have to list if you pay any one creditor more than $600 total in the 90 days preceding the filing of your bankruptcy. This is to prevent what is called the preferential treatment of a creditor, i.e. paying one creditor off but wiping out your other debts.

You are only required to list everyone that you owe money to. If you have a credit card that has a $0 balance on it, you do not owe that creditor any money and they do not have to be listed. However, most major credit card companies, MasterCard, Visa, American Express, and Discover, get notice of every bankruptcy that is filed anywhere in the United States. They match that information against their open accounts and close any account even if there is no money owed on it.

You might be able to keep a store card that does not have a balance but you are better off getting a new credit card after you file a Chapter 7 bankruptcy. You may have to get a secured card where you put a deposit down and your credit limit is the amount of your deposit.

If you are struggling to pay your credit card bills, a Chapter 7 bankruptcy may give you the fresh start that you need. Contact Hampton Roads Legal Services today at 757-276-6555 to schedule a free consultation on how bankruptcy can help you.