Highest Interest Rate on Credit Cards Review

Posted On: September 30, 2006

Author: luckyl
Posted: Wed Jun 30, 2004 1:39 pm
Post subject: If Banks already gouge @ 28%, can they move higher w/prime.

Quick point / question…If in this time that the Fed rate and prime rates are at all-time lows and Credit cards are still charging on some cards as much as 28% interest (supposedly variable with the prime rate).

If the prime goes up and these CC’s are already charging the max interest rates…their margins would shrink, normally they pass that on by raising their rates. Can they still do that if they are already gouging customers @28%? Could we see 30+% rates? Is that legal? Aren’t their usury laws capping how high these rates can get?

Absolutely yes without a doubt. Don’t feel to bad though, it is not only the gougers that will raise rates, even super prime issuers like mbna, citi, chase, bofa are going to pass this increase on to their customers, but to your point. If emerge is charging you 29.75, your new rate is 30.00 and yes it is legal.

There’s no federal cap on interest rates - it’s up to the states. Many states like New Hampshire and Delaware have none. Usury is alive and well.

Verne
_________________
Any agreement that can be changed at any time, for any reason, is no agreement at all.

Yeah, that is pretty much what I thought.
Just seems so stupid and short sighted to me that as a Business, bank one would do something asinine like charge 27.99% just for a high debt/credit limit ratio.

I have options, lots of people will find options to pay this off at such an high rate. I will be paying this off asap and not doing business with Bank One again, ever, in my life!

If any moron at Bank One ever reads this, that’s what will happen when you jack up rates that high, customers will walk away from them that can, the ones in trouble will wind up getting pushed off the cliff by bank one into bankruptcy. Pretty stupid business practice…idiots.

Mr. Lucky, I wish you were right. The unfortunate truth is that they will gain far more than they will lose. A few, like yourself, will do everything in their power to resist high interest rates. However, and this is hard to believe, most people don’t even know how much interest they are paying and don’t think it’s a big deal when interest rates are raised.

Do you really want to know how to get lower interest rates? The answer will sound simple, but it’s almost impossible to make it work: educate consumers. Make everyone aware of what they are paying and make them aware that they have choices. If a majority of users took great pains to shop for credit instead of taking whatever they find first, or getting a card from their own bank because, and I’ve heard this one an appalling number of times, “that’s what you’re supposed to do.”

I’ve been through this conversation many times: “I pay too much in interest on my card.” “Why don’t you get one from XYZ Bank?” “But that’s not my bank.”

Until and unless consumers can be taught to shop for credit, banks can and will do whatever they want.