That’s right 79.9%. No typo.
…The bloated APR is how First Premier Bank, a subprime credit card issuer, is skirting new regulations intended to curb abusive practices in the industry. It’s a strategy other subprime card issuers could start adopting to get around the new rules.
Typically, the First Premier card comes with a minimum of $256 in fees in the first year for a credit line of $250. Starting in February, however, a new law will cap such fees at 25 percent of a card’s credit line.
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In a recent mailing for a preapproved card, First Premier lowers fees to just that limit â€” $75 in the first year for a credit line of $300. But the new law doesn’t set a cap on interest rates. Hence the 79.9 APR, up from the previous 9.9 percent.
How is this not usury? The people that would get a card like this can not afford to pay such a ridiculous interest. Have they not been paying attention? This is the sort of ridiculousness that nearly destroyed our economy one year ago. My mind is sputtering with anger.