Bad credit credit cards are offered by many banks as credit rebuilding tools to assist borrowers with turning their credit rating from negative to positive. Bad credit credit cards intended to make it easier to obtain and re-build credit, this is good benefit for consumers and merchants alike. Bad credit credit cards work and function just like regular credit cards, but they have rules and guidelines that are specifically for high risk credit card cardholders.
When you have bad credit you can still usually get a secured credit card. Secured credit cards require a cash deposit that becomes the credit limit for the card. Secured credit cards can help improve bad credit.
The bad credit credit cards offered by financial institutions carry higher interest rates and stricter payment options. Be sure not to overextend yourself and borrow more than you can afford.
With bad credit credit cards it is important to make timely payments to re-establish credit. You also do not want to have a balance near the credit limit. A high balance or delinquency wil defeat the purpose of having a bad credit credit card.
With a bad credit credit card you often can establish other forms of credit at many smaller stores. Although these forms of store credit are not the greatest type to have, it will put you on the way to establishing tradelines and timely payments.
Bad Credit Cards are also known as Secured Credit Cards. What this means is that the cardholder of a secured credit card is still expected to make regular payments but should he or she default on a payment, the card issuer has the option of recovering the cost of the purchases paid to the merchants out of the deposit