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How does leaving a credit card (with a zero balance) out of the bankruptcy affect your credit?

Pasadena, CA |

I'm a full-time college student & I'm a joint account holder on my dad's credit card. He's going to file ch 7.

We have a zero balance on the card & therefore he's not required to list the card with his other debts.

But I know most creditors usually close down joint credit card accounts after a co-borrower files bk, especially when one or both borrowers have minimal income. In other words, he doesn't look very creditworthy right now & I'm a student.

They also say it looks very bad on your credit report to have an account that was closed by the creditor. This has me wondering if it'd be best for us to close down the account ourselves before the creditor does.

What would be worse to have on my credit report: An account I closed myself or an account that the creditor closed on me?

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Attorney answers 3


The adverse impact of closing the account by the creditor compared to closing the account by the account holder in your situation could be the same. Generally speaking, the closing of your account reduces your overall available open credit line, which is why it usually reduces your credit score. I'd recommend that you don't close the account yourself.

Frank W. Chen is licensed to practice law in the State of California. The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult your own attorney.


Do you have any other available credit in just your name? The reason is - if you had a line of credit and you closed it, that means that line of credit is no longer available to you. Also, are you actually a joint borrower? Or just an authorized user?

If you are a joint borrower, then it might make more sense to get your dad's name off of the card and keep the line of credit/credit card in your name alone. Use it every other month to buy a tank of gas or buy groceries and then pay the bill in full when it comes. This will help you keep your credit score up.

If you have other lines of credit, then its probably ok to close this account. While your credit will take a small hint, it will improve.

I don't know who is "they" or where you are getting your information from.

For information about your credit report and score, try www,

Kathleen M. Dunne

Kathleen M. Dunne


If the credit-card company won't let you take your dad's name off and keep the account open (based on your own credit-worthiness), then you could try opening a secured credit-card account in your own name (see my Legal Guide for Rebuilding Credit After Bankruptcy), and use it as Ms. Hunter suggests above. That should offset any negative impact from closing the account.


I would also suggest keeping the account open

This answer is intended to provide general information only. It does not create an attorney client relationship nor should it be construed as legal advice or an opinion on specific situations. Donald A. Green is only licensed to practice law in California and Oregon.

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