The 3 Worst Credit Cards That You Could Ever Own

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Credit CardsI was looking through the mail the other day and noticed a stack of credit card applications. From television commercials to internet ads, we are bombarded with credit card advertisements. Credit card companies pitch products to people whose credit ranges from excellent to poor. Individuals with credit ratings that fall in the fair to poor range are often preyed upon by “fee harvesters”. Fee harvesters are companies that offer low-credit, high-cost cards. Signing up for a credit card with a high interest rate and exorbitant fees is like having an albatross around your neck. It is better not to have a credit card than to be stuck with a high-cost card. With cards like these, it makes sense that More Americans Are Saying No To Credit Cards.

Worst Unsecured Card

The First Premier Bank Gold Card is a credit card that has attracted a lot of media attention recently due to its astronomical 79.9% interest rate. I think it’s ridiculous that a credit card with an interest rate of almost 80% is legal in the United States. The initial credit limit for the Premier card is $250. As soon as you activate your card, First Premier Bank will gladly sock you for the following fees:

  1. $95.00 Program Setup Fee
  2. $48.00 Annual Fee
  3. $29.00 Servicing Fee
  4. $84.00 Annual Servicing Fee ($7.00 monthly charge)

After taking all of these fees into account, your available credit is just $71. If you add in the monthly servicing fee over a whole year your account would be overdrawn $6 before you have ever charged anything! This is the worst credit card I have ever seen. This card has charges for everything from credit limit increases to bill payments.

Worst Secured Card

New Millenium Bank tries to give First Premier Bank a run for its money with their secured credit card. Customers pay a 19.5% interest rate for the privilege of carrying a New Millenium Mastercard. Did I mention that the 19.5% interest rate is the minimum APR available? This is the highest interest rate that I have ever seen charged on a secured credit card.

  1. $99.95 Account Activation Fee
  2. $10.00 “Rush” Processing Fee
  3. $59.00 Annual fee

The New Millenium card has no grace period which makes it nearly impossible to pay this card off, because you start accruing interest from the minute you make a purchase. New Millenium also offers a prepaid card with an activation fee of $99.00 and a monthly participation fee of $5.95. That’s a total of over $170 in fees alone.

Worst Prepaid Card

According to The New York Times, “Prepaid debit cards are among the consumer banking industry’s fastest-growing products, but often their convenience comes with hidden fees.” The Prepaid Visa RushCard is an example of this type of card. The RushCard offers 2 basic plans. The Pay-As-You-Go plan has a hefty $19.95 activation fee and all signature and PIN transactions cost $1 per transaction. ATM withdrawals are $1.95 a piece. The other option is to become a monthly member, which has the following fees:

  1. $9.95 Monthly Account Maintenance Fee
  2. $3.00 Card Activation Fee
  3. $2.00 Enrollment Fee For Online BillPay
  4. $1.00 Bill Payments
  5. $1.00 Paper Statement Fee

So, what lesson can you take away from these examples? If you are going to carry a credit card, stay away from those three cards. Always remember the three basic rules when looking for a credit card:

  1. Look for a card with a major trusted financial institution. This makes it easier to contact your financial institution is you have any problems.
  2. Avoid cards with high interest rates and no grace periods. A high interest rate can cost you thousands of extra dollars.
  3. Watch out for hidden fees (activation fees, annual fees, processing fees). High fee cards make it way too easy to go over your credit limit.

(photo credit: orphanjones)

  • Lakita (PFJourney)

    When I first read about that First Premier Gold card…I thought it was a joke. I cant understand WHY anyone would want this card??? It seems like it was created just to prey on those that don’t read the fine print.

  • Zach @College for 10k

    I guess the sad thing is that so many people can only apply for and get accepted for the First Premier Gold card. Predatory lending anyone??

  • Jamel Rose

    If you have a credit card, chances are pretty good that your deal got worse in the past year.Secured cards allow people with bad credit, no credit, little credit history, etc., to show they can be responsible with credit.

  • gina

    I just can’t see the upside to using a credit card. Pay with cash!!

    • Mark Riddix

      That is ideal Gina.

  • Karmella

    Ouch – not good. It used to be (many, many years ago) that a secured card was a decent way to rebuild or build credit, which is an upside if you want to buy a home or car sometime. Do any of the major banks still offer the secured cards, for more reasonable fees?

    • Mark Riddix

      Most major banks have moved away from offering secured cards. I believe that Wells Fargo still offers secured cards.

  • Happi Shopr

    These practices should be illegal. I’m not seeing how the bill that just went into effect is helping those with credit card debit one bit.

  • Chris

    Credit cards are only good when you have it tied to a rewards program, like the AmEx blue cash. In those cases, I find it much better to pay by credit card than cash. The caveat being I pay the card in full every month.

  • Mac

    This article does a good job at shining a light on those poor credit card practices, but these particular cases are more an exception than a rule. Why would anyone want to carry a card like this anyway? There are many good cards that have no annual fee, but lately very few with a fair interest rate.
    All my cards somehow jumped to 25% of late w/o me ever paying late once. :( Not that I carry a balance, but that’s besides the point.

    • Mark Riddix

      These credit cards are the extremes but the average interest rate on a credit card is up to 14%.

      • Nichole

        Yes, they are extreme BUT they are out there and many people uneducated about credit sign up for these. My friend signed up for the 1st Premier card and it was not until I showed her the fine print that she realized what a rip off it was, she just wanted a credit card very bad. By the way, Citi also offers a secured card.

  • sunkisd

    The Banana Republic credit card is the worst credit card of all time. I have been a credit card holder for numerous years, and have never not paid a payment in full every month, This credit card is notorious for blocking transactions that they feel are high (obviously not counting BR themselves!!) without any reason other than the amount. Because of them, I might not receive some of my wedding attire in time. The only reason I knew was bc I was calling them about a separate translation and learned my former transaction did not go through. They literally have the worst customer service I have ever received. I really believe they must prey on the poor, because otherwise why would they cut off normal transactions because they seem “too high?” Do yourself a favor and ditch this card and get a united chase card. Way better service and you don’t have to worry about being cut off for no reason. I lost my chase card and they expedited it to me in two days.