A credit card for bad credit can allow consumers that did not have ready access to credit the flexibility and convenience of having a credit card.  Credit cards for bad credit often come with more restrictions and higher interest rates than standard credit cards due to the credit history of the card holders who use these cards making it even more important for consumers with poor credit to shop and compare bad credit cards thoroughly.

For consumers that have experienced a poor credit history and have had trouble making their monthly credit card payments, it may appear prudent to sit back and evaluate the need for a new credit card.  However, without a credit card consumers are not able to get hold of the conveniences that are found in credit card use such as needed credit access, purchase protection, credit card rewards programs and more.  Bad credit card holders can gain those benefits plus also reestablish and build a solid credit history once again with a bad credit credit card.

An increasing number of consumers are facing credit problems in recent years.  Even for consumers that have a measurably poor credit history, there are credit cards for bad credit available.  There are a number of bad credit credit cards that can be a good choice for consumers with some minor credit problems and those with major credit problems.

There is no clear definition of what a credit card for bad credit is.  For that matter, there is no clear definition of what bad credit or poor credit is.  The standards of what sort of credit history defines bad credit changes frequently.  There are several different types of credit cards for bad credit cards available that can cover a wide spectrum of credit problems, including; prepaid credit cards, secured credit cards, and unsecured credit cards.

Some consumers have such a bad credit history and poor credit rating that credit card companies will only consider approving a secured credit card.  With a secured credit card the consumer has to make a deposit as security for the new credit card.  In most cases, the amount the credit card holder has to deposit as security is equal to the credit card limit the credit card company will approve.  The secured credit card works just like a traditional credit card with a credit limit, interest charges, late payment fees and other attributes normally associated with a traditional credit card.

An unsecured credit card for bad credit doesn’t require a deposit with the credit card company.  Unsecured bad credit cards are regular credit cards, except that the credit card interest rates and fees are generally much higher than standard rates due to the increased risk the credit card issuer is taking.  The initial credit card limit is also generally significantly lower depending on the credit history of the applicant.  The credit card limit may be increased periodically as long as the credit card account holder pays the account in a timely fashion.

Prepaid credit cards are not actually credit accounts but function more like a debit card.  To obtain a prepaid credit card, the account holder has to open an account with the issuing bank by depositing a certain amount of money that is loaded on to the card account.  The amount that is deposited is the limit of the card.  The bank is, however, not actually issuing you any credit; any purchases made with the card are debited from the deposited funds in the account.  When the funds on deposit are all used, the card is no longer usable until more money is loaded on to the account.  There are no monthly payments, since the money on the card is already paid.  Most all prepaid credit cards require absolutely no credit check.

Whichever type of bad credit credit card is chosen, compare all of the rates, terms and conditions closely.  With the wide choice of card available, there are certainly some credit cards that have better credit card rates and fees than others.

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