Being able to use a credit card can make your life easier, as it increases your purchasing power, and helps you manage your cash flow. If you have a poor credit history, it may be difficult for you to get approved for a new credit card account. Those who have bankruptcies, foreclosures, and other blemishes on their credit card accounts have a hard time getting a credit card company to work with them. If you are interested in getting a credit card even though you have bad credit, here are some of the most frequently asked questions that you may be interested in getting answers to.

What is a Secured Credit Card?

For those with blemishes on their credit, a secured credit card is one of the best options for you to consider. A secured credit card is one that uses some kind of collateral to secure the debt that you accumulate on your card. With most secure credit cards, you have to put down a deposit that will act as the collateral. When you put down the deposit, the company then gives you a credit line that is based on the size of your collateral. For example, if you put down a $500 deposit, you may be able to get a $500 credit line. This way, if you don’t pay back the money you owe, the credit card company can simply keep the deposit that you made.

Secured credit cards can be a good tool to use when trying to rebuild your credit, because the credit card companies will report to the credit bureaus. Over time, it will help build up your credit profile.

Will I Pay the Same Interest Rate?

When you have poor credit, you may have to pay a higher interest rate than what you would pay otherwise. Some credit card companies have a special interest rate for people who have low credit scores. This means that even if you have good enough credit to qualify for a regular unsecured credit card, you might have to pay a higher rate on your balances.

Will I Get a High Credit Line?

If you have good enough credit to qualify for an unsecured credit card, the credit card company may start you off with a little limit. When you have a questionable credit history, the credit card company will probably want to make sure that you can handle debt before giving you a big limit. For example, the credit card company may start you off with a $1,000 limit and see how you do. After several months of using the card, and making your payments on time, the credit card company may boost your credit line up to $2,000. If you have made your payments on time, you can also request a credit line increase from the credit card company.

Will Using a Card Help Me Boost My Credit Score?

If you use a credit card once you have poor credit, it can help you boost your credit score. One of the best ways to improve your score is to use credit responsibly. After you make some purchases, and then make your payments, you’ll be able to boost your score.

Sometimes, it can be difficult to get a regular credit card when you have poor credit. If you’ll start with a secured card, and work your way up, you can get your credit back up to a respectable level again.