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After bankruptcy, I've had a secured credit card for one year and have made all payments on time. Can I get an unsecured credit card now?

By , CardRatings contributor
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Question: I filed bankruptcy during the fall of 2009. It was discharged in January 2010. I took out a secured credit card for $1,000 and have now celebrated my one-year anniversary with that card. I have paid the bill in full each month and never been late. Is there another card I would be eligible for without it being a secured credit card? How can I best rebuild my credit score?

Answer: Since you've established a good payment history (congratulations!), your best bet is to reapply with the same bank that issued your secured credit card and ask for one of their unsecured credit cards. A year of good credit history should go a long way toward supporting your application. Generally, that bank you've been working with is going to want to keep you as a customer, especially since you've paid the bill in full each month and haven't been late, so your odds of being approved should be pretty good.

Ideally, your secured credit card has been reporting your payments to the credit bureaus. (Most do, but check your credit report to be certain.) And I'm glad you didn't apply for a prepaid card in this case. Many consumers who can't get credit cards, or can't get them easily, like them for a variety of reasons, but using them won't have any effect on your credit.

If for some reason the bank that issued you the secured credit card won't give you an unsecured credit card, I'd talk to customer service and ask them why, and what hoops you need to jump through to get one.

Other options are gas cards, which are relatively easy to get with minimal credit history, and department store cards, which have a low entry barrier for people with bankruptcies or poor credit. Department store cards typically charge high interest rates, though, so you really want to be careful not to carry a revolving balance and only use a store credit card to help you build up your credit.

No matter which card you use, the best way to rebuild your credit score is to keep doing what you're doing: pay in full, and especially, pay on time.

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