Overdrive Extra

Max Heine

Banks find way to win card game

| February 09, 2011

How would you like to pay 60% interest on your credit card?

If you’ve followed finance news the last few years, you know that the Credit Card Accountability, Responsibility and Discosure Act of 2009 was supposed to end such outrageous practices on the part of lenders.

Well, it did. Sort of. It restricted certain kinds of fees and required more disclosures. And for the basic interest rate, retroactive hikes are mostly ruled out, but there’s no cap on rates for new customers. Since banks got their hands slapped for some of the sleazy ways they used to make money, they’re now having to lean harder on what’s still legal.

Owner-operators are big users of credit cards. They also probably have disproportionately bad credit ratings, which means they’re prime candidates for getting gouged for rates on a new card.

“Interest rates are now hovering near record highs, at an average rate of 14.72%,” reports CNNMoney.com, which explores this topic in more detail. “And if your credit is bad enough, you could even end up with a rate as high as 59.9% APR.”

Be careful what credit card offer you sign up for. Practice good cash management and keep your credit rating high.

Tipping The Scales: Time To Trade In And Trade Up With Cummins ISX15 SmartAdvantage.

Notice: Overdrive is transitioning to a new comment platform due to technical problems with the former commenting system. The new commenting system is now live. We are currently in the process of moving all of the comments from the old system into the new system. We appreciate your patience in the meantime.