Going through bankruptcy can be a stressful process, whether you choose to do it through Chapter 7 or Chapter 13. However, after the process is over, most people are wondering how they can rebuild their credit. One of the ways that you can improve your credit after bankruptcy is through the use of secured credit cards. According to US News and World Report, a secured credit card is a great way to help improve your credit if you cannot be approved for a traditional, unsecured credit card.

Most people think of unsecured credit cards when the word “credit card” is mentioned. This means that there is no deposit on the card, and the card issuer is agreeing to “loan” you the money up to your limit each month with the understanding that you will either pay that amount off or, at minimum, pay a specified amount toward the balance. An unsecured credit card, on the other hand, requires you to put down a deposit before you receive the card. In turn, that deposit amount becomes the credit card’s maximum limit. So if you put down $500 on your secured credit card, you will have a maximum limit of $500.

This is so that, in the event that you do not pay back the money, the credit card issuer can then take the money from the deposit. Secured credit cards, however, do report to major credit agencies. This means that if you can use a secured credit card responsibly, you will be able to start using it to rebuild your credit. Even if you cannot get a traditional credit card after bankruptcy, a secured credit card may be an option for you.