As some customers with poor or little credit may know, there is one less option as they scramble to get approved for credit cards in the deteriorated state of the economy. Some may believe that the recent unavailability of subprime credit cards is a bad thing. Credit Card Professor can assure customers that it is not a bad thing at all.
Over the past ten years predatory credit card companies have been allowed loose restrictions on lending policies. With the development of the consequences that subprime credit cards have made, new laws have been placed to protect the consumer from the credit hole that is dug with these types of credit cards.
To better understand why subprime credit cards are no longer offered, it is helpful to gain knowledge of what subprime credit cards are first.
The subprime loan was made for people who cannot obtain credit easily due to previously negative credit reports. This means that the loan catered to the already financially burdened portion of the credit card applicants. These cards usually began with a very low credit limit and carried extremely high fees and interest rates. For example, a subprime credit card company may give a consumer a $300 dollar credit line. With that credit line comes an annual fee of $49, a processing fee of $99, a program participation Fee of $89 and a monthly maintenance Fee of $10. All of those fees equal a $120 charge a year.
After the charges have been deducted from the credit card holder’s credit limit, there would only be an available balance of $53. Before customers even signed their new credit card they were already in debt.
There are better alternatives out there that cater to credit seekers with bad credit. Credit Card Professor offers these alternatives, allowing customers to apply for cards knowing that their credit limit will not be wiped out with excessive fees, sky high interest rates and high maintenance charges.
| < Prev | Next > |
|---|
