79.9% Interest on Credit Card – Say it Ain’t So!

December 21, 2009

stop loan sharksIf you thought 36% interest on a credit was bad, how about a 79.9% interest rate. It sounds crazy, but it’s true. Thank you South Dakota.  As CWN has reported, South Dakota opened the flood gates for banks to charge these outrageous, loan shark, interest rates.  Now, First Premier Bank is taking it to a new high or should we say low.

It’s an effort to avoid new fee regulations being posted against credit card companies, starting in February. It sure didn’t take long for First Premier to figure out a way to get around the new government regulatory caps. And rest assured, many of the other sub prime lenders are sure to follow in this direction to skirt the new law.

First Premier Bank charges a variety of annual and first year fees: account set-up fee, program fee, annual fee, and monthly servicing fee. The total cost of first year fees on a new card holder comes to $256.00. The new regulations will cap these fees at 25 percent of a card holder’s credit line and reduce the banks fees to a maximum of $75.00 on a credit line of $300.00.

To offset this loss, First Premier Bank decided to make use of the fact that the new regulations did not cap the interest rate they can charge. They have recently issued cards with fees of $75.00 and an interest rate of 79.9 percent. There will also be a $29.00 late fee and over credit limit fee.

Click here to read more about First Premier’s outrageous new interest rate for its customers.