To apply for a credit card using a house as collateral, first assess your home’s equity by subtracting your mortgage balance from its current market value. Contact lenders offering secured credit products or home equity lines of credit (HELOCs) that accept real estate as collateral. Submit documentation including proof of income, credit reports, and property details. Once approved, the lender places a lien on your property, and you receive a credit limit based on your equity. Use the card responsibly, as missed payments risk foreclosure.

This approach leverages home equity to secure higher credit limits and lower interest rates compared to unsecured cards. The Federal Reserve reports that HELOCs offer average rates of 6.5% to 13.5%, significantly below unsecured credit card rates (16.22% in 2023). Collateral reduces lender risk, improving approval chances for borrowers with average or poor credit scores. However, 15% of HELOC borrowers default within five years, per American Express data, emphasizing the high stakes of missed payments. Secured cards tied to home equity also help rebuild credit, with users typically achieving a 20-30 point score increase within 12 months, according to Experian. While beneficial, this method demands strict financial discipline to avoid losing property.