Well, WATCH OUT: What exactly did the new cc legislation do?

[filingsoon]

I have been hearing that there are changes coming in the credit card industry as of 01/31/2010, i haven't been following the news on it, but I did some searching tonight on First Premiere's website and it doesn't look to be good.

First Premiere is one of those cards that is willing to issue for people with bad credit. They have a bunch of fees that usually amount for at least $200 for the first year. if you go to any of their current credit card offers they say only valid through 01/31/2010 due to the new legislation.

I also looked at their new product and it's called

get this:

lower fees but THE INTEREST IS 59.9% AND NO GRACE PERIOD!

AND NO THAT'S NOT A TYPO 59.9% IS THEIR INTEREST RATE.

Comments are welcome!

[lrprn]

get this:

lower fees but THE INTEREST IS 59.9% AND NO GRACE PERIOD!

AND NO THAT'S NOT A TYPO 59.9% IS THEIR INTEREST RATE.

Comments are welcome!

No one is forced to apply for this credit card or any other. It's the person who applies to get a card with this kind of interest rate that's foolish beyond understanding. But people go get payday loans with interest rates way higher than this even now.

Bottom line - these high-interest cards and loans are voluntary. At some point we have to wake up and stop taking these ridiculous, ruinous financial risks just to keep or buy more stuff. Then these financial rapists will go out of business. It's as simple as that.

[frogger]

No one is forced to apply for this credit card or any other. It's the person who applies to get a card with this kind of interest rate that's foolish beyond understanding.

At some point we have to wake up and stop taking these ridiculous, ruinous financial risks just to keep or buy more stuff.

Wasn't it P.T. Barnum that said there was a sucker born every minute?

[Pizza]

I have been hearing that there are changes coming in the credit card industry as of 01/31/2010, i haven't been following the news on it, but I did some searching tonight on First Premiere's website and it doesn't look to be good.

First Premiere is one of those cards that is willing to issue for people with bad credit. They have a bunch of fees that usually amount for at least $200 for the first year. if you go to any of their current credit card offers they say only valid through 01/31/2010 due to the new legislation.

I also looked at their new product and it's called

get this:

lower fees but THE INTEREST IS 59.9% AND NO GRACE PERIOD!

AND NO THAT'S NOT A TYPO 59.9% IS THEIR INTEREST RATE.

Comments are welcome!

Pardon me, but for someone trying to rebuild their credit without carrying a new debt load, wouldn't this be good news? After all, pay your balance off each month and the interest rate is still 0%! Those fees have always been a huge rip-off; I for one would like to see them go.

[viking64]

If you are 100% certain you can and will pay the bill in full each month, then it's a better deal than the Premier card that runs into 100s of dollars of fees each year. However, pay anything less than 100%, and the 59% goes to the balance of everything on the card until it's paid off.

If your limit is only $250 or so, then you should be able to handle it within a couple of months, and the interest charge isn't worse than an IMAX movie ticket. However, at that rate, if this the only non-secured card you could get, it seems to me it's better to self-fund your credit card (i.e. secured card). Heck, with the fees of the current premier card, you pay almost as much upfront as you would for secured card with the same credit limit.

That way, there are lower fees and you KNOW you can't get into trouble. Even the best intentioned could miss a payment or not be able to pay in full due to a trip, an unforeseen expense, etc. Then, apply for a more sane card a year or so down the road.

[WeIzBankrupt]

Thats nothing, havent you heard of the simaler card charging 79.9% interest!!? No joke, I saw it on yahoo and its ligit. Crazy...

[Flamingo]

The credit card industry is a business and businesses are formed to make money for the owners and stockholders. You are a consumer and they want your money. You have the right to say yes or no. If you say "yes," you accept what they charge you and are totally responsible for what you do with that card. If you are irresponsible, you get hit with the fees and it is no one's fault but your own (I am using "your" as a general term for anyone reading this).

My most favorite statement is a sentence I saw in recent financial article - "A Credit Card is a Snake in your Pocket." Something with a 59% or 79% interest rate is a Cobra!

[CCsAreEvil]

You'd think there would be some national/state legal limit on interest rates.

[forgotten]

Pardon me, but for someone trying to rebuild their credit without carrying a new debt load, wouldn't this be good news? After all, pay your balance off each month and the interest rate is still 0%! Those fees have always been a huge rip-off; I for one would like to see them go.

If there is no grace period then the interest would begin to accrue as soon as the charge is made. A $500 charge, getting the statement 20 days after you charge it and 5 more days for you to pay would net you $20.51 in finance charges even if you paid in full.

[AMISLANDER]

Wasn't it P.T. Barnum that said there was a sucker born every minute?

Right on!

[Michigan1951]

Good freaking grief!! 59%??????? Holy Moly!!!!

[filingsoon]

My point is that at Interest has been capped at 36% annually before, but now with this new legislation they actually removed the cap. The cap was originally put in place to limit the problems that the uneducated consumer could get into by signing up for one of these cards. Now the cap will soon dissapear as of 02/01/2010.

Also some states like Oregon where I live ran the payday loan people out by limiting the interest they could charge (I think they capped it at 36% annually too.) after the legislation passed every payday loan place closed shop. To help out some of the local banks offer payday advances to their customers now at high but not unreasonable rates (below 36%.)

And yes, no grace period means you pay interest from day 1. I wonder how the temporary "holds" on CC will work, since when you use a card for travel they don't put through the final charge unless you tell them to.

[Bell30656]

When rebuilding credit this is exactly the kind of credit card that one should get. Since my Chapter 7, I've only applied for and received one card. While my interest rate isn't as high as that one it does have fees. I use the card as a "charge" card rather than a credit card. Every month I use it, pretty much up to the limit then pay it off directly from my checking account.

Simple rule: If you don't have the cash to pay for it, don't buy it especially when in the rebuilding stages.

[forgotten]

When rebuilding credit this is exactly the kind of credit card that one should get.

Wouldn't a secured card make more financial sense? Since you can find them with no/little fees and even earn interest on your depoit collateral?

Most banks will convert to unsecured after a period of time with perfect payments.

[Bell30656]

A secured card does make sense in some cases. However, many of the secured cards out there are from companies that have a bad reputation of high initial fees and then it takes an act of congress to get that deposit back after you close the account. I read the fine print on one that charges a "processing fee" to return your deposit 120 days AFTER you close the account.

I haven't seen to many of the low fee secured cards floating around these days besides the interest that they pay is less than one percent while the interest that they charge is about 30-36%.

Using a credit card as a "charge" card rather than a credit card works out better for rebuilding credit. Most secured cards show that they are secured on the credit report. A card with a zero balance each month and unsecured really looks great to lenders.

*Note* The card that the OP posted about is a First Premier account.