     Anonymous | Sunday, February 20, 2000 - 06:33 pm 
In 1997, the line of work I was in suddenly dried up, leaving me unemployed for about six months and only able to make my home payments and pay current bills for the next six. By the time I was on my feet again, my accounts had all been closed by the creditors.
I spent the next 2-3 years working, studying to improve my career, and settling accounts one by one whenever I could. Still, new applications for credit continued to be rejected until about six weeks ago when I got a pre-approved visa application in the mail.
The company wanted a $29 processing fee. I figured someone in my position couldn't be picky so I sent a check and last week I was sent the card. (I have to confess, I didn't read all the fine print. I just checked the credit limit--$500--and stuck it in my wallet. I used it once at the grocery store just to make sure it worked.)
A few days later, however, I got a statement from the company and couldn't believe it. It was for $175--a $119 "acceptance fee", a $50 annual fee, and a $6 "usage" fee which I will have to pay every month--all in addition to the $29 I've already paid.
Clearly, I'm being taken advanatage of because of my poor credit. I suppose I could go back to the grocery store, offer to settle up another way and have them reverse the charge to the card, then cancel it. But then I'd be right back where I started from. Or would I?
Is it worth it to bit my lip and keep this card? Will it improve my credit rating, lead to my getting better credit cards again (I used to have all gold cards) and pay for itself in the long run. Or is this just a scam that preys on people like me?
Anyone know?
Dan |
| Lynn Whealer | Sunday, February 20, 2000 - 10:58 pm
Judgement call, Dan. I too had the same questions when I started getting my situation straightened out almost 2 years ago. At the time I was bitching about being taken advantage of, much as you are. Scam? Depends upon your tolerance level, I suppose. Usury? Morally, no doubt....legally, I guess not.
But now, after I have succeeded in taking my credit life back, I look back and believe that the money that was gouged out of me was worth it to be where I am today (having "paid the piper" I guess). But it sure doesn't feel good when you're having to take it on the chin at the time.
One of the more important things to find out (as illuminated on this forum in a recent thread) is whether your new card, and others you might get, WILL ACUTUALLY REPORT to the CRA's. If they don't, and it seems to be getting more common with the sub-prime lender market, then having that particular card does you NO GOOD at all with your credit improvement needs. |
| Anonymous | Monday, February 21, 2000 - 03:57 am
Had my Providian card for over a year. Six months in, I noticed that they had never reported to the CRA's. Called them; complained; they said it would be taken care of. Six months after that, I closed the account & realized they'd NEVER reported my trade line to the CRA's. Called again; complained. They finally put the trade line on there, but only one months' worth of reporting indicating "Last 12 months paid as agreed". Real nice, eh?
If it's Providian you're talking about, check your report(s) within the first few months to see that they are reporting. |
| kristy welsh - creditinfocenter.com | Monday, February 21, 2000 - 06:55 am
Who is the creditor and I can give you a feel for whether they will a) report to the CRA'a b) be worthwhile to keep. (No promises here, but I have dealt with lots of these companies and have researched them somewhat extensively.)
I have had lots of good experience with: Futurecard, Regions Bank, First Consumers, American Pacific Bank.
Stay away from: Ace Visa and Cross Country Banks at all costs, I have had so many complaints about them, it's unreal. |
| Anonymous | Monday, February 21, 2000 - 03:33 pm
Everyone,
Good point. All the companies aren't necessarilly the same.
The firm that wanted $29 up front, $175 now and $6 every month in exchange for $500 worth of Visa credit calls itself First National Credit Card. It accepts inquiries at an Evansville, IL address but wants payments sent to Sioux Falls, SD.
Another thing that made me suspicious is that right after I received the card, I got another preapproval from something called First PREMIER Bank MasterCard which charges almost identical fees and is also located in Sioux Falls, SD, with the same zip code.
Anyone have any experiences with these guys.
Dan
[P.S. And speaking of differences from company to company, Providian (mentioned above) is the only firm that I could not and would not settle with. Others generally were polite and flexible when they understood that I didn't have much money but wanted to work with, Providian was rude, disorganized and threatening. I eventually told them to never call back. Ironically, they were the only ones I never had a credit card with in the first place. They bought my account from someone else.] |
| kristy welsh - creditinfocenter.com | Tuesday, February 22, 2000 - 08:06 am
I've never heard of them or had any complaints, but that info may not be very helpful. |
| Lynn Whealer | Tuesday, February 22, 2000 - 10:11 am
There seem to be a lot of credit card companies in Sioux Falls...I guess it's just an economically good place for them to operate customer service centers and operations. |
