If you’re looking for an unsecured credit card and you have a poor credit history, take a moment to think about the situation logically.  You have a track record of either not repaying your obligations or of paying them late.  You had credit at some point and demonstrated an inability to handle it in a manner consistent with the lender’s expectations and your contractual agreement.  Under those circumstances, why would a bank be interested in giving you “another shot”?

Lenders are in business to make money and they don’t profit when people default on their obligations.  When people are consistently late with payments, it conveys a message to lenders that there is a significant risk of default.  Thus, if you have bad credit, the banks won’t be tripping over you in order to give you new lines of credit.

That does not, however, mean that they won’t consider it.  They may be willing to offer you a limited unsecured line of credit, but you’ll need to be prepared to pay fees and an interest rate that’s considerably higher than those offered to “prime” customers.  The lender is gambling when it extends credit to a known risk and will smartly hedge that bet while increasing the profitability of the account if it’s properly maintained.

So, if you’re searching for bad credit unsecured credit cards, be ready to settle for lousy terms.  And be prepared to look everywhere for an option.  The overall economic downturn has produced a significant tightening of credit.  Those “credit freeze” headlines aren’t just about bank-to-bank loans and other huge business transactions.  They reach all the way down to the realm of consumer lending.  Banks just aren’t as excited about extending credit to higher risk individuals as they once were.

Instead of bending over backwards in hopes of finding bad credit unsecured credit cards, you might want to look at another option.  Of course, we’re talking about secured cards for bad credit borrowers.  These options allow you to secure credit even if you do have a significant negative history.

Basically, you make a deposit with the lender and that money serves as collateral against your account balance.  Although you’re expected to make payments on a monthly basis, the bank doesn’t need to worry quite as much if you do default–they have your deposit to back up the account.

Obviously, this does have a downside.  You need to have the cash necessary to make the deposit in order to secure the credit card.  Bad credit unsecured credit cards would certainly be more convenient in that sense, but one could argue that you shouldn’t be taking out a credit line unless you have at least that much money available to back it up.  Additionally, the terms associated with secured credit cards are much better than those attached to bad credit unsecured credit cards.  That advantage can serve to equalize the required deposit outlay.

If you have a poor credit history and are looking for a credit card, you have two options.  You can either search and search for increasingly rare unsecured cards for which you might qualify.  This can require a great deal of digging and will probably yield little more than a small-balance account with a high interest rate.  Alternatively, you can make a deposit and open a secured credit card account.  You’ll spend more up front to access a full credit account, but it will probably make more sense in the long run.