Can I keep one of my Credit Cards when I am declaring bankruptcy?
In a bankruptcy situation, many people dread not being able to use a credit card because they are so used to using it.
The above question, therefore, is frequently asked – “Can I keep a credit card? I need it for emergencies.”
The simple answer is No. The bankruptcy laws do not allow a bankrupt to keep or use a credit card while bankrupt.
In the second place, even if you hid the credit card from your bankruptcy proceedings, the credit card company will soon find out that you have declared bankruptcy and cancel it.
Once the card is cancelled, you would be forced to either include the bill in your bankruptcy proceedings or you would have to pay back that bill.
If you include it in your proceedings, you will pay back every cent you have borrowed on that card since you declared bankruptcy. In an extreme situation, you may even be charged with a fraudulent use of a credit card.
In a Consumer Proposal situation, however, you may keep a credit card, if at the time of the proposal, the balance on the card is zero. However, you cannot use the credit card while your proposal is in force.
If you need further information about mortgage or debt problems, contact
Ken Ntiamoa, MBA
BIA Insolvency Counsellor
(416-398-1877 ext 201)