5 Shadiest Credit Cards

Photo: CNN Money

(BusinessPundit) Credit is the lifeblood of any well-functioning economy.  It allows us to buy cars, houses, education and terabytes of filthy, filthy porn (you know, the stuff so filthy you can’t find it for free).  For most people, their most accessible line of credit is a credit card — basically an instant ability to cover sudden outrageous expenses without having to pawn belongings.  If you don’t have a credit card, you better have a rainy-day fund as big as Scrooge McDuck or else you’re one car repair or medical expense away from bankruptcy.

Credit card companies know that customers depend on this line of credit, sometimes desperately, so they do their best to provide it an easy and simple a fashion as possible.  Just kidding, they try to gouge customers for every last red cent in anyway that will keep them technically legal.  Or they’ll just take your money without telling you.  You know, like the exact definition of a thief.

“Fee-Harvesting” Cards

For those with low incomes or abysmal credit scores, getting a credit card with a decent interest rate and credit limit can be a frustrating challenge.  Once you finally do find a creditor willing to give you the time of day, you’re likely to end up with an usurious interest rate and a credit limit roughly high enough to buy some crusts of stale bread and weeks-old milk.  While unfortunate, from a business perspective this makes sense.  A bank can’t simply go lending out money to high-risk individuals without trying to protect their investment somewhat, so it’s hard to blame them for being careful and circumspect about who they extend credit to.

Or it would be, if this is what actually happened.  In reality, these cards for the credit-poor are often what experts refer to as “Fee-Harvesting” cards.  What this means is that someone might get a card with a limit of $200-$300 dollars, and an interest rate in the high 20s.  Buried in the fine print of the agreement is a whole bevy of fees, often adding up to a huge chunk of the customer’s credit limit.

In one case, a customer with a credit limit of $250 was only able to put $50 on the card after all the fees were applied.  The worst part about all of this is that the fees apply whether or not the card is used or paid off each month.  Meaning that someone who doesn’t pay attention to the fine print, and barely uses the card at all, can suddenly find themselves hundreds of dollars in debt after a few months.  And that debt will only continue to pile on at that incredibly high interest rate.

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