Thursday, August 14, 2008

America's Worst Credit Card Offer?

The average American household gets credit card advertisements in the mail every so often. Most are by serious banks that are offering a serious credit card offer that often involves special benefits such as zero interest for an extended period or airline miles or some sort of saving benefits at participating retailers. But then there's those nonsense credit card offers from First Premier Bank which really disgrace the good name of MasterCard in what has to be the very worst of terms for any credit card offered that I know of.

Most good credit cards don't charge an annual fee, except for some special business class of cards from American Express who offer almost unlimited credit lines to some businesses almost like a small business loan organization. But American Express is a very good company. But First Premier Bank not only charges an annual fee of $48, plus a $29 account set up, a $95 program fee(whatever that is supposed to be), plus a monthly service fee charged at $84 a year, and if you want a second card, well that's only another $20. And guess what this company only offers a credit line of $250 to many users, leaving them just $71 in credit left all these fees, unless you opt for the second card option, then you have a giant $51 credit line to spend.

Of any credit card that I know of, this has to be the absolute worst of the worst of terms. It is probably persons with bad credit, young people, minorities and others that this company targets. There is even a cash advance credit limit of just $25 for many users.

Many lower income persons with bad credit may think that they are getting a credit card. But this First Premier Bank MasterCard is hardly much more than a great deal of fees and probably even worse than those absurd prepaid cash "credit cards".

The fact of the matter is that lower income persons will only continue to be victims of all sorts of high fee schemes or other schemes because of their weak financial position in society and their history as being bad credit risks. Some states like Oregon sought to tighten up the rules on some schemes such as those cash advance or pay day loan businesses, and many have closed up shop when they were restricted to charging much lower interest rates. But the bad terms credit card schemes will only likely exist for a lot longer because they are far more difficult to control. But the fact of the matter is that one should never have to pay an annual fee for a good credit card except for those special class of American Express Business cards that work like small business loans to business users.

Ripoff Report on the Internet features many complaints from unhappy users about First Premier Bank and their outlandish fees for their MasterCard scheme. It is almost surprising that MasterCard doesn't set some rules down with First Premier Bank and restrict them to fairer and more upfront terms with their users. First Premier Bank had to pay a $4.5 million dollar settlement in a case brought against them by New York Attorney General Andrew Cuomo. In one case, a man had two $250 limit cards issued by First Premier and only spent just $51 before cancelling the cards, but wound up $1,017 in debt to them in fees.

Unfortunately, there are many schemes that target the lower income in society, and not every person can understand the terms of a contract that they sign. First Premier Bank wants you, or better yet, your money.


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