High Interest Credit Cards Lure Atlanta Consumers Struggling With Debt
It's been two years since the Credit CARD Act was passed and it seems that credit card interest rates have gone nowhere but up.
Despite the common belief, the legislation didn't put a limit on rates - only the way in which credit card companies could charge them, explain Atlanta bankruptcy attorneys. Today, creditors are not allowed to retroactively hike rates whenever they please. Instead, they must state the rate upfront - only raising interest when a customer makes a late payment. In response, banks are offering cards with much higher upfront rates - like the 59.9% APR offered First Premier. And if you think consumers won't go for it, think again. First Premier has issued 700,000 of its high-rate cards - and counting.
So why are so many people willing to fork over so much interest? Simple - they think they have no choice. Credit card companies are raising rates highest on the cards they market to people with bad credit. These are the folks that can't qualify for a card anywhere else, or so they think. So they resign themselves to paying nearly 60% interest, not to mention activation fees, monthly and annual maintenance fees, and additional penalties for making a transfer or missing a due date.
If you're looking for a card to help rebuild your credit, don't choose one that could be impossible to pay off. You want to lower debt, not make it worse. And if you can't qualify for a rate you can afford, another credit card probably isn't the answer - but bankruptcy might be.
Many folks avoid bankruptcy because they mistakenly believe it will hurt their credit. The truth is, most people who file for bankruptcy don't have much credit to speak of anyway. Bankruptcy allows you to erase your financial past so you can move forward. Sure, bankruptcy will stay on your record for several years after filing - but that doesn't mean your credit score won't improve. In fact, many DebtStoppers clients qualify for credit cards immediately after filing. With your debt troubles out of the way, chances are you'll qualify for a rate a lot better than 60%. Wondering if bankruptcy is right for your financial situation? Try a free one-on-one debt analysis with an Atlanta bankruptcy attorney today.