There used to be a time, that once you've filed for bankruptcy, or defaulted on a credit card, that you were blacklisted from ever owning an unsecured credit card again. Nowadays however, there is a plethora of credit card companies that offer unsecured credit cards to individuals with bad credit, or individuals who have filed for bankruptcy.

Many credit card companies that offer unsecured credit cards to individuals with bad credit, usually start out by initially offering applicants higher annual fees and lower credit card limits. Just about every major credit card company offers an unsecured credit card for individuals with bad credit. If you pay the credit card payments on time for several months or years, then the credit card limits are usually raised periodically. As long as you keep paying the payments on time, the credit card limits are raised.

Some credit card companies buy up unpaid, or defaulted on, credit card debt. This debt is also known as a “non-performing” loan in the banking industry. These credit card companies will then go back to the original credit card holder, who defaulted, and offer them an opportunity to repay the old credit card debt. Usually, these credit card companies will offer the debtor an incentive for repaying the debt. This incentive is in the form of issuing the debtor a new unsecured credit card. This new credit card will have a balance with the limit of the old debt.

The debtor will have an opportunity to repay the old debt, for little or no interest, and will accumulate a new active credit limit for every periodic amount that is paid on the old debt. For example: for every $100.00, that is paid on the old debt, the debtor will receive a $25.00 credit limit increase on the new unsecured credit card. The terms of repayment are usually very strict, however, it is an excellent way to redeem one's credit. In this way, an individual will erase an old debt in which they defaulted on, and establish a new line of credit.

Another way to obtain a credit card when you have bad credit, is to apply for a secured credit card. A secured credit card is a credit card that you actually pay the amount that you wish to charge in advance. The credit card limit is dependent on how much money the card holder actually pays into the account. These cards usually have an annual or monthly maintenance fee. Although this doesn't sound very beneficial at first, the payments, if made on time periodically, actually do establish a history of responsibility, and believe it or not, establish good credit, over long periods of time, if the credit card company reports to the credit bureau.

Applying for unsecured credit cards is an excellent way for individuals with bad credit to purchase items through the normal credit card billing systems found at retail stores and on the internet. These credit cards can also be used at ATM's and at cash advance terminals. The best attribute about unsecured credit cards, is that it is almost impossible to be turned down, because your bad credit history is irrelevant.

The truth is, that if you have bad credit, it doesn't mean that you can't obtain a major credit card.