Banks Go Hard Money In The Name Of Good Business!

Let's sit back and take a minute to think about really bad ideas. Putting a fork in a toaster, now's that's a bad idea. Going on vacation with the in-laws is another bad idea. Paying 79.9 % interest on a credit card, yep, that's a really bad idea.

Can paying that much be legal or is it Hard Money? Well for your information it is completely legal, and even worse many hard working Americans are actually being forced to pay that much.

Right now a national bank is charging 79.9% on their credit cards, and as long as they fully disclose their terms per the federal Truth in Lending Act, it is completely legal. But in my opinion it is quite shocking that not only a financial institution would try something like this, but also they are getting away with it.

The national average in America today for credit cards is 14.15 percent and someone is getting away with almost 80%? In the last few months, situations such as this has become a topic of much conversation on Capital Hill, in fact there is talk of reinstating a nationwide cap on credit card interest rates. In December a lawmaker proposed a bill to cap rates at 16 percent, and hopefully for the debt of the American people, something similar to that goes through.

In recent times due to the fragile financial state of the nation it is fairly predictable that someone is going to try to make this time of heartache and suffering work for them financially. In a time where the unemployment and foreclosure rate is up, it is human instinct to look out for one's self, but honestly who would agree to 79 percent interest? Credit Counselors have been warning consumers more and more to read all of the fine print, no matter how tedious, before signing and to seek all options in order to make a well informed and well educated decision and this guidance should not go unnoticed.

A new act put into law in 2009 limits the upfront costs that credit card companies can charge on accounts held by consumers with bad credit or little to no credit history. Because of the laws that are popping up to help those who need them, companies are getting more and more crafty with offers that shift the money from high start up fees to high interest rates. This way lenders still get their cut, but they are within the letter of the law. Also, because of the way that the new laws have been written, companies are tightening their credit standards. This means that the approximately 70 million people with "problem" credit, or credit lower than 640, may take 16-24 months to improve their credit, when before the credit crunch it would have only taken 8 to 16 months.

Right now companies are still testing the waters with the 79.9% cards, stating that it takes up to 9 months to read market trends. But my question is why is this permitted? These companies are taking one of the basic necessities for living wealthy in America- credit, and marketing it to the un-wealthy with similar tactics to dangling a steak on a string in front of a starving animal. They are showing a glimmer of hope- a credit card, which if you pay on time will raise your credit thus allowing you to pay your bills and give your credit score just a little more strength. But in fact they are hurting the people who need the most help.

Realistically they are offering hope to high-risk clients that will most likely not be able to pay after the interest is added. Thus, financially beating the already downtrodden. Aren't you glad that in "the richest" country in the world (according to the media) this kind of financial strong-arm tactics are legal?

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