By Candice Choi, AP Personal Finance Writer
NEW YORK (AP) — It’s no mistake. This credit card’s interest rate is 79.9 percent.
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.
In a recent mailing for a preapproved card, First Premier lowers fees to just that limit — $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.
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MB: Shocking! For those of us who wish to avoid the outstanding interest rates of First Premier Banks credit card, the Visa Black Card is an alternative. The new Visa Black Card takes luxury to a whole other level; offering 24/7 superior concierge service as one of their many benefits, also including a variety of insurance coverage’s and the best luxury rewards a credit card company can offer. There is one problem however, it is nearly impossible to get approval; only 1% of Americans have the income and credit to get approval for the Visa Black Card. Visa wants to ensure that only the richest and most prestige people in the world can use this product.
http://finance.yahoo.com/news/Credit-cards-newest-trick-799-apf-3359014390.html?x=0&.v=4
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