Wednesday, October 21, 2026
Learn how to rebuild credit and get a credit card after bankruptcy. See how to recover your credit with secured cards and payment strategies here.
One of the most common questions people considering bankruptcy have is, "Can I get a credit card after bankruptcy?" Many worry that bankruptcy will mean the end of their ability to get credit and live financially independently.
The fact is yes; you can get another credit card after completing a bankruptcy. The key is to build positive habits that restore your credit score. There are ways to begin to rebuild your credit score, even after you’ve completed a bankruptcy. Filing for bankruptcy can feel like the end of your financial future, but it doesn’t have to be.
Bankruptcy is a legal process in Canada that helps people who can no longer manage their debts get a fresh financial start. When you file for bankruptcy, you work with a Licensed Insolvency Trustee, the only professional authorized to administer bankruptcies. You cannot file for bankruptcy without the help of a Licensed Insolvency Trustee.
You make monthly payments to your Licensed Insolvency Trustee. If your income is above a certain threshold, you’ll be required to make surplus payments.
This threshold is not a set number, it depends on factors such as how many dependants you have.
You are required to submit monthly income and expense reports to your Trustee to help them see if surplus payments are necessary.
A first bankruptcy lasts 9 months if you don’t need to make surplus payments and 21 months if you do.
When you file for bankruptcy, it issues a “stay of proceedings.” This halts most kinds of legal action against you for the debt.
Debt collectors must halt calls and collection efforts, and creditors cannot sue you or garnish your wages.
It’s a common myth that you will lose everything if you declare bankruptcy, but there is a long list of assets that cannot be seized in each province.
Some items that are often exempt from being taken include:
Click here to read our guide on bankruptcy exemptions by province for a better idea of how this might apply to you.
That doesn’t mean that you won’t have to sell some assets. You may be required to surrender assets to your Licensed Insolvency Trustee, who will then sell them to reimburse your creditors.
You’ll be required to complete two credit counselling sessions as part of a bankruptcy. These sessions cover budgeting, money management strategies, and ways to rebuild your financial health after bankruptcy.
As part of bankruptcy, you’ll be required to surrender your credit cards. You are required to do this by law under the Bankruptcy and Insolvency Act.
When you file for bankruptcy, your credit rating will automatically drop to R9, the lowest possible rating. Bankruptcy will stay on your credit report for six to seven years, depending which province you live in.
Your credit score will drop too, but it’s impossible to say how much, as everyone’s credit score and situation are different before they file for bankruptcy. You should expect a drop of over 100 points, though.
The good news is that both of these are recoverable. Having a low credit rating and score is not permanent.
You are not allowed to use a regular credit card during bankruptcy. It may also be difficult to get one immediately after. That doesn’t mean you can’t begin to rebuild your credit and eventually apply for one, though. Here are the best ways to rebuild your credit after bankruptcy.
Secured credit cards are often the best way to rebuild credit after bankruptcy.
A secured credit card works just like a regular credit card, but with one key difference: you must provide a cash deposit that then becomes your credit limit.
For example, if you deposit $500, that amount is also your spending limit.
If you fail to make payments, the card issuer can then take the deposit as a way of covering your debt. This makes secured cards less risky for lenders and easier to obtain, even after bankruptcy.
Credit card companies report secured credit card activity to credit bureaus, which helps you build or rebuild your credit history. Each on-time payment shows lenders that you can manage credit responsibly, gradually improving your credit score.
Secured credit cards are different from prepaid credit cards. Prepaid cards DO NOT get reported to credit bureaus, so they don’t help you build credit.
Sometimes it is possible to get a secured credit card even while going through the bankruptcy process, but this is never guaranteed.
Using a secured credit card responsibly by making all your payments on time and in full will improve your credit score. You may be able to apply for a normal credit card within a year if you use it to raise your credit score high enough.
Paying your bills on time and in full is one of the most important steps you can take to rebuild your credit after bankruptcy.
Every on-time payment shows lenders and credit bureaus that you can manage your financial obligations responsibly. This includes utility bills, phone bills, and any other regular monthly payments you need to make.
Missing payments or paying late can quickly hurt your credit score, while consistently paying on time helps repair the damage caused by bankruptcy.
Paying your bills in full will also help you build a positive payment history, which is the most important factor in improving your credit score.
Keeping your credit utilization low is one of the most effective ways to improve your credit score after a bankruptcy.
For example, if you have a credit card with a $1,000 limit and you carry a $200 balance, your utilization is 20%. Experts generally recommend keeping your utilization below 30%, and lower is even better.
Your credit utilization makes up 30% of how your credit score is calculated, according to Equifax, one of the nation’s largest credit bureaus.
When you maintain low utilization, it signals to lenders and credit bureaus that you can manage credit responsibly without relying too heavily on it.
Even if you only have a secured credit card initially, paying off your balance in full each month and keeping your spending well below your limit will start to raise your credit score.
If debt is weighing you down, speaking with one of our Licensed Insolvency Trustees can help you take control of your finances. The first consultation is completely free, with no obligation to proceed.
Our Trustees work closely with you to review your entire financial situation, including debts, income, and expenses. They explain all the options available to you, helping you understand what each choice means for your short- and long-term financial health.
We provide support in a professional, judgment-free environment. Our team’s goal is to guide you toward the solution that fits your needs and helps you regain financial stability.
Wednesday, October 21, 2026
Learn how to rebuild credit and get a credit card after bankruptcy. See how to recover your credit with secured cards and payment strategies here.
