Credit and Debt Blog

Some of the most atrocious credit card fees are becoming more widespread. A new breed of credit cards has entered the marketplace, and the fees on these predatory products can easily wipe out most of the credit limit. Worse more, these leave vulnerable consumers strapped with additional debt and on a track for further credit damage.

Imaging getting $200 a year in credit card fees in addition to any traditional late or over-the-limit fees. Think a credit card cannot charge you for a credit limit increase? It is happening!

Some new credit cards are designed for consumers that cannot prove their creditworthiness. These products are marketed aggressively to unsuspecting consumers that do not take the time to actually read what they are signing. These are people that are probably paying $12 or more for the right to buy a Big Mac on credit.

These are the fees that are becoming very popular on these newer products:

• High APRs
• Account Set-Up Fees of $99 or more
• Program Participation Fees of $89 or more
• Annual Fees of $49 or more
• Account Maintenance Fees of up to $120 a year
• Low Credit Limits of $250 – $300
• Credit Limit Increase Fees of up to $25

Some of these issuers charge $25 just to increase your credit limit by $100 or more. In many cases, these increases are automatic and the cardholder is stuck with the fee unless they decline the increase in writing. This is something most desperate consumers will not do.

What is truly unsettling is that only a few bucks of the total credit limit are even available for purchases once all of these fees are added in. These credit cards are so abusive that they have become known as “fee-harvester” cards.

When deciding on whether to apply for a credit card, take the time to read the offer and evaluate if it is worth the cost. I don’t know anyone that would choose to pay $15 a gallon for gasoline when everyone else pays $3. Buying on credit simply is not worth it at that price!