The new 79.9% Credit Card (not a typo)

[Purseval]

http://finance.yahoo.com/banking-bu...t-card-defends-its-product?mod=bb-creditcards

This will become more common as the new CC laws take effect. They will be marketed to poor credit risks and the bankers liken it to auto insurance for bad drivers.

 

[dreamin_disney]

http://finance.yahoo.com/banking-bu...t-card-defends-its-product?mod=bb-creditcards

This will become more common as the new CC laws take effect. They will be marketed to poor credit risks and the bankers liken it to auto insurance for bad drivers.

i read this the other day. I just can't believe it! Now I've been hearing about cc charging annual fees. I think its going to get outrage for everyone even those with good credit and that pay off the bill each month.

 

[Planogirl]

What in the world would be a typical payment under such a rate? Wow, unbelievable.

 

[indimom]

What's amazing to me is that there are people who will buy into this..who would actually agree to those kinds of terms!!

 

[Purseval]

According to the article there are 70 million people with bad credit that will have a lot of trouble finding anything else starting next month. The cards have a low limit and are really designed to be paid off each month and avoid any interest. They haven't had any trouble at all signing up customers. In fact the card has done better than expected.

 

[happygirl]

That is insane. They are praying on people who need credit and are willing to pay that much

 

[eliza61]

According to the article there are 70 million people with bad credit that will have a lot of trouble finding anything else starting next month. The cards have a low limit and are really designed to be paid off each month and avoid any interest. They haven't had any trouble at all signing up customers. In fact the card has done better than expected.

Not surprisely. That makes me mad because when these customers default, the banks will use this as an excuse to punish every one else. I had a huge argument with citibank about giving my college son a credit card. Why in the heck would you give an unemployed 18 year old a card with 3K limit. and sorry I know according to som 18 year olds are supposed to be "responsible" etc but he's a typical college kid, if it's not an immediate threat to life or limb he'll worry about it tomorrow.

IMO, it's just like giving an alcoholic a drink and then punishing him for getting drunk.

 

[Mickey527]

I read in the article that they said "If someone obtains this card and has that kind of rate they should see a credit councelor immediately."
I have a neighbor who continues to get credit cards even though she and her husband have filed bancruptcy 3 times. Evbery 7-8 years they are at court getting rid of all their debt. they just eliminated over $60,000.00 in credit card debt but they have 3 62" tv's and all new kitchen appliances among other things. It makes me so angry that although I have more credit card debt than I am comfortable with I would never claim bancruptcy and most of my cards are now in the 19-24% rate.

 

[dhdozier]

Unbelievable and terrible. I am sure the news will be full of sad stories of desperate folks who get one because they don't know better or feel they have no other options. Sickening...

 

[dhdozier]

Not surprisely. That makes me mad because when these customers default, the banks will use this as an excuse to punish every one else. I had a huge argument with citibank about giving my college son a credit card. Why in the heck would you give an unemployed 18 year old a card with 3K limit. and sorry I know according to som 18 year olds are supposed to be "responsible" etc but he's a typical college kid, if it's not an immediate threat to life or limb he'll worry about it tomorrow.

IMO, it's just like giving an alcoholic a drink and then punishing him for getting drunk.

Totally agree with you. I wish our high schools had the opportunity to really educate our kids on the dangers of credit card debt and how to balance a budget. Instead, I feel like the focus is on making them learn how to pass tests instead of to worry/focus about things that could really help them in life!!!!!

 

[Colleen27]

Not surprisely. That makes me mad because when these customers default, the banks will use this as an excuse to punish every one else. I had a huge argument with citibank about giving my college son a credit card. Why in the heck would you give an unemployed 18 year old a card with 3K limit. and sorry I know according to som 18 year olds are supposed to be "responsible" etc but he's a typical college kid, if it's not an immediate threat to life or limb he'll worry about it tomorrow.

IMO, it's just like giving an alcoholic a drink and then punishing him for getting drunk.

I read in the article that they said "If someone obtains this card and has that kind of rate they should see a credit councelor immediately."
I have a neighbor who continues to get credit cards even though she and her husband have filed bancruptcy 3 times. Evbery 7-8 years they are at court getting rid of all their debt. they just eliminated over $60,000.00 in credit card debt but they have 3 62" tv's and all new kitchen appliances among other things. It makes me so angry that although I have more credit card debt than I am comfortable with I would never claim bancruptcy and most of my cards are now in the 19-24% rate.

Are respectable companies really extending credit to people in these situations, or has it always been the shadier lenders? I ask because I've applied for exactly one credit card in my adult life - the Disney Visa, thinking we'd use it and pay it off each month for the rewards - and we were turned down! Not surprising and I don't fault Chase for it; we're both self-employed and have virtually no credit history because we've lived cash-only for more than a decade. But I do wonder when I hear about how companies are/were giving credit to anyone because that wasn't our experience at all.

 

[DVCBELLE]

Totally agree with you. I wish our high schools had the opportunity to really educate our kids on the dangers of credit card debt and how to balance a budget. Instead, I feel like the focus is on making them learn how to pass tests instead of to worry/focus about things that could really help them in life!!!!!

I agree!! I really wish that my school had given us a budget class. It could have been once a week for a year. Give us a "salary", monthly budget and expenses! Your homework each week could have been to shop for items we needed that week. They could have had Christmas in there, a spring break, etc!

I can't believe that someone would apply for a rate that high. I do think the criteria for getting is that you are immediately enrolled in credit counseling!

 

[Disneyworld Kirk]

Be careful for cards you have also! We got a piece of mail that looked like typical 'junk' mail. Of course I open it all to be sure and it was a letter stating that a card we haven't used in a year or two was starting to charge us 60 bucks a year as an annual fee unless we charged over a certain amount a year. We only had a month to opt out, which I did today and they closed the account.
This could easily have been passed by and set aside and get charged if you're not paying attention.

Phew!
Kirk

 

[Purseval]

I had a huge argument with citibank about giving my college son a credit card. Why in the heck would you give an unemployed 18 year old a card with 3K limit. and sorry I know according to som 18 year olds are supposed to be "responsible" etc but he's a typical college kid, if it's not an immediate threat to life or limb he'll worry about it tomorrow.

The official line might be about responsibility but in reality college kids get credit because if they get in trouble their parents tend to bail them out. If nothing changes but school ends those same kids would be denied for the same reason, once they graduate the feeling is more that they are now on their own.

I applied for credit cards for both of my kids, in their own names, while they were in college and used them for automatic payments of things like the cable bill. They didn't have physical possession of them but they were building credit histories all the same.

 

[eliza61]

Are respectable companies really extending credit to people in these situations, or has it always been the shadier lenders? I ask because I've applied for exactly one credit card in my adult life - the Disney Visa, thinking we'd use it and pay it off each month for the rewards - and we were turned down! Not surprising and I don't fault Chase for it; we're both self-employed and have virtually no credit history because we've lived cash-only for more than a decade. But I do wonder when I hear about how companies are/were giving credit to anyone because that wasn't our experience at all.

Oh heck yeah.
When we went to college open houses with #1 son during Jan, Feb and Mar of '09 I swear every single major bank had a table at the open houses. They give away free stuff like book bags, college t-shirts and caps if the kid signs up. And the sales pitch is always about using it "for the emergencies" like books etc.
My kid is a good kid and we tried to teach them about savings etc from an early age but I think he's a normal young adult. He always has a "plan"
so in his mind, he'll just charge the pizza for him and 5 friends and when he gets his small check or extra cash he'll pay it off.
So far our warnings have paid off (this is his first year) mainly because we encouraged him to concentrate on his studies. He has a card that is linked to ours but I still worry.

 

[cats mom]

My first thought was that folks who sign up for a card with that kind of interest rate never really intend to pay the thing off. That they've probably bought into the nonsense commercials telling people their debt can be settled for pennies on the dollar. You know the ones... call now to get your personal piece of the bailout. But after reading the article; not only is the interest rate insane, there's a $75 upfront fee to set up an account with a $300 limit.
Crazy!

 

[hrh_disney_queen]

Wow, talk about setting someone up for failure..

 

[Purseval]

Wow, talk about setting someone up for failure..

The market this is intended for are people who are already proven failures, no need to set them up for anything. The fees and high rates are to offset the risks of dealing with people who have either already shown themselves to be a high risk in the past or have no history and no reason to believe they are anything other than a high risk.

 

[dd50]

Totally agree with you. I wish our high schools had the opportunity to really educate our kids on the dangers of credit card debt and how to balance a budget. Instead, I feel like the focus is on making them learn how to pass tests instead of to worry/focus about things that could really help them in life!!!!!

You can also do that at home. I instill in my kids every day that even though I use my credit card I will not use it if I can't pay it off when the bills comes. They do learn by example. They are never to young to learn about money.

 

[dd50]

If any one is thinking about one of the cards they should really save some money and get a secured card.