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A Mail Offer for Credit Card with 79.9 % Interest Rate
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by Frank Liao | October 15, 2009 at 10:54 pm
1338 views | 26 Recommendations | 6 comments
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Gordon Hageman received a credit card offer in the mail with a whopping 79.9% APR. He couldn't believe what he saw, "My first thought, it was a mistake," Hageman said.
The credit card offer came from First Premier Bank, USA's 10th largest issuer of Visa and MasterCard. On its website's front page, they have a prominently displayed credit card application link for those with "less than perfect credit".
There's nothing than can be done to stop this practice of issuing credit cards with outrageous interest rates because there are no federal laws that prohibits it. Banking interest laws are governed on a state level. In the case of First Premier Bank, based in South Dakota, they are permitted to charge whatever they want, because the law in South Dakota state that there is "no maximum or usury restriction (South Dakota Legislature)".
"I think you’re beginning to border on deception there," San Diego State marketing professor Michael Belch said.
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Frank Liao
Vancouver, British Columbia, Canada
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Most RecentMost Recommended Comments (6)
at 23:41 on October 15th, 2009
There are some very positive incentives to owning this card, to wit:
a) Monthly reminders. If you overlook your payment, several smiling gentlemen will come to your door and attempt to help you to remember.
b) Late payments will seem minor indeed, when compared to your interest rate.
c) You will be able to top any of your co-workers complaints.
d) It is perhaps the only educational credit card in existence. Use it once, you will learn never use it again.
at 05:56 on October 16th, 2009
Some great points Hugh =:-)
at 04:51 on October 16th, 2009
A loan here in the UK for credit risk people has an APR of 272.2% from Provident personal credit.
Source: providentpersonalcredit.com
at 10:15 on October 16th, 2009
That used to be called "loan sharking".
Now it is "banking"
at 10:45 on October 16th, 2009
It's the legal form of loan sharking without a doubt... I'm sure of it.
at 10:21 on October 16th, 2009
Yea! Free market at work! Down with the nanny state!