Centennial Credit Card Review

Executive Summary - One of the very few remaining unsecured sub-prime cards today. The fees are very high and so is the APR. Those considering this card would do well to research others like Credit One. If your credit is in the 600s, you might as well check out the this one from Barclays.

The Centennial Credit Card is issued by FIRST PREMIER® Bank in Sioux Falls, South Dakota which also offers the First Premier PREMIER® Bank Credit Card. Both cards are designed for people with no credit or bad credit and work similarly with almost identical fee structures.

Fees and How This Card Works When you are approved for the Centennial Credit Card you will receive a $300 credit limit. As with many sub-prime credit cards however, this is not the amount of available credit you will have when you receive your card. You will have to pay a $75 annual fee and a one time application fee of $95. Since the CARD ACT restricts credit card issuers from issuing cards where upfront fees cannot reduce the initial credit limit by more than 25%, we are unsure as to how First Premier Bank was able to get away with the $95.00 application fee. This security deposit will be returned by you close the card and will be used as a collateral if you still owe money when you close your card. Additionally, the interest rate on this card is quite high at 36% (it used to be at 49.9%).

The subsequent annual fee is technically lower at $48. But they tag on a monthly maintenance fee of $6.50 monthly which is equal to $78 annually. So the fees you will pay from the second year onwards is $126! (even more than an Amex Green Card!).



How does this fare versus it's peers? - Frankly speaking, this card simply sucks. How can you compare this card to any other sub prime card when the rate is 36%? Even notorious cards like Imagine Gold MasterCard and Tribute MasterCard (both from CompuCredit Corp) never had such high interest rates. Cards like Total Visa, Continental Finance MasterCard and Rewards 660 Visa all had rates around the 19% or in the 20s.

The fees of this card reflects the passing of the CARD Act. Specifically, the CARD Act requires fees not to be more than 25% of the initial credit. Previously, sub prime cards charged insane fees like one time application fee and processing fee and with an initial credit of $300, you were only left with $50 or so. With the CARD Act, Centennial got around this by charging just the first year annual fee of $75, which reduces the initial credit limit by 25% (so you get $225 in credit limit). But they then introduce a monthly maintenance fee which effectively increases the annual fees you have to pay.

The real competitor to this card is Credit One. Rather than dinging consumers with one-time application fees and monthly maintenance fees, you will just have to pay an annual fee (which ranges from $35 to $99). However you look at it, it is much lower than Centennials' total fees. The APR ranges from 17.9% to 23.9% (though high, is much better than 36%). It also has a reward program whereby you can earn points when you use the card to purchase gasoline from gas stations.

Verdict and Update - As with all subprime credit cards, the fees and interest rate on the Centennial credit card are quite high. Frankly speaking, we find it outrageous for anyone to be applying for a card that charges a 36% (it used to be 49.9%) APR or interest rate. That is as good as 50%. If anything, this resembles a payday loan type interest rate! We would not recommend this card given it's outrageous rates.

But if your credit bad, then the type of cards that you will be approved for really depends on your specific circumstances. For example, if you have charge offs or collections that are not settled or if you have recently emerged from bankruptcy, then secured cards are going to be your best bet. Even First Premier might decline you. A card like First Progress would be a good idea.

If you do not have collections or charge offs (or they have been paid), and you have been timely with your other credit obligations like your auto loan or secured card, you may have luck with a couple of no annual fee unsecured cards from Barclays. See consumers reviews here.

If that fails, then the Credit One Bank Visa with Gas Rewards is a good alternative as it charges only an annual fee (unlike FP) and gives you points for gas purchases.

Whether Centennial Credit Card is a new card or revamped card or not available like its counterpart, the First Premier Card, it doesn't make much difference when you consider the reputation of a bank and how it treats its customers. Cardholders will likely not forget that First Premier once offered a card that carried an APR of 79.99%, which was lowered to 49.99% but remained as outrageous. Unless First Premier reappears with an entirely new line of credit cards for the sub-prime market, I would think twice about accepting any card that First Premier offers.