A Credit Card With A 79.9% APR

[JakeStratham]

I'm surprised this is legal:

Credit card had a 79.9% APR from First Premier Bank - Feb. 7, 2011


If you don't want to read the piece, here's the gist:

1. Banks are issuing cards with outrageously high interest rates, some up to 79.9%.

2. The end.

Think no one is dumb enough to get one? Check this out...

The card proved popular with consumers, said First Premier Bankcard CEO Miles Beacom, but the performance was bad: "A lot of the people ran up the card, defaulted and went directly to charge off."

As a result, they dropped the rate to 59.9%. "We also tested it at 23%, 33%, 45%, but 59.9% is the one that shows the best performance and where the organization can market the product," he said.

Since then, nearly 700,000 people have signed up for the card -- and more than half of them carry a monthly balance.

Good grief. These people vote. We're doomed.

 

[CitizenSmif]

What the fuck is wrong with people..

I suppose this is not much worse than pay day loans.. it was only a matter of time.

 

[sumohax0r]

Its obv for people that are just trying to repair there credit, Even though there are better ways "I'm sure" for someone that needs to get there shit back in order could charge $50 to the card and just pay payments, interest + a little towards the balance just so they could get some positive credit history.

Now, if someone used this as there main CC and not for credit repair, then they are fucking retards.

 

[medicalhumor]

If they continue stuff like this, there needs to be a protest of Egyptian proportions. These banks are just raping the country.

Until then, time to target my ads to these card holders and sell 'em everything I can.

 

[papajohn56]

Why shouldn't this be legal? Some people are very high risk. It's still lower than other options.

 

[JakeStratham]

These banks are just raping the country.

I remember a year ago when the Card Act was gaining steam (I think it was called something else back then). A high-up suit for one of the card issuers was asked what he thought about the new regulations. His response? Essentially...

"Doesn't matter. We'll get our money in other ways."

Pretty bold. And apparently, pretty true.

At least the banks are testing their offers. That's more than I can say for some marketers I know.

Why shouldn't this be legal? Some people are very high risk. It's still lower than other options.

I'm not saying it should be illegal, PJ. You know me better than that. I want nearly everything legal. Let folks make their own decisions.

I'm just surprised it's legal, given the current environment.

 

[cfordtally]

There are laws against unfair usury.

 

[papajohn56]

I'm not saying it should be illegal, PJ. You know me better than that. I want nearly everything legal. Let folks make their own decisions.

I'm just surprised it's legal, given the current environment.

Yeah, my bad - I'm used to when people ask somewhat of rhetorical questions like that, they mean that it "should be".

There are laws against unfair usury.

This isn't usury. It's not like you have to have this credit card.

 

[robognome]

There are laws against unfair usury.

When local jurisdictions (read individual states attorneys) tried to enforce these laws a few years ago in the US, the US Office of the Comptroller (who?) which has Federal jurisdiction over credit cards, stepped in to claim that the local governments had no jurisdiction over such matters as excessive and arbitrary interest rates. Then they proceeded to do absolutely nothing about the problem themselves.

 

[galacon]

Caveat Emptor, biotches... Just exactly as it should be.

EDIT: As long as the terms are clear enough that any reasonably intelligent person can understand them. If they are not, then I would have a problem with that.

 

[Rage9]

They are typically marketed as debt rebuilding tools as it's the type of card you have to pay for before you can even use it, if I remember right was was like $125-$150 off the bat to have like $300 available credit on the card. After successful payments your credit line goes up.

Although I'm sure there are people out there that will acquire credit any way they can. Once yours is shot to hell there aren't that many easy ways to acquire credit, and it's not like you can really go balls deep with a $300 limit. A perfect card to teach retards how to use their credit.

 

[gamingneeds]

Ahhh... democrats.

 

[jeffrey]

Time to push biz-ops so these people can get out of debt.

 

[tencentpiece]

I wonder what the payout on promoting that type of card would be, lots of cards in aus are already at like $150/conversion or even like 100+ for applications.

 

[lukep]

This kind of thing will only become more accepted by our steadily-more-stupid culture. The brilliant prophecy you know as Idiocracy demands it.

 

[bensonenterpris]

79.9% seems high but not when you compare it to 200-300% or more on payday loans. It is possible that the people that are getting these cards are looking at it a temporary solution to their financial problems. Sadly, what they fail to realize is that it is not really a solution but part of a bigger problem that will make it even harder for them to find financial freedom.

I have seen it happen, some unexpected expense comes up and you go out and get a payday loan or a high interest credit card. It is the "act now, worry later" mentality. That is what I believe keeps the credits cards charging these high rates.

 

[TFLNetwork]

It also teaches people to live in their means and not spend more than they can afford to pay off at the end of the month.

 

[robognome]

Time to push biz-ops so these people can get out of debt.

That ship has sailed. Several times.

And will sail again soon.

 

[barman]

It also teaches people to live in their means and not spend more than they can afford to pay off at the end of the month.

wrong. it doesn't teach them shit.

 

[lschmidt]

I don't know what my own APR is, nor do I care.

Just pay it off completely every month. That's the *only* responsible way to use a credit card, IMO.