Credit cards for bad credit for dummies
You take out a secured credit card by giving the lender a sum of money that acts as your security. Your credit line is equal to the amount you deposited. You use the secured credit card just like a regular, unsecured credit card, charging to it and paying the bill as usual. However, if you default for any reason, your bill is paid out of the security. Because the lender knows they will be repaid in full from your security even if you cannot pay out of pocket, offering a secured credit card to a borrower with bad credit is a low credit risk.