Mr Credit Card
Executive Summary - A card with an extremely high fees associated with it. Before you apply, you would do well to consider other lower cost alternatives like Credit One or even a secured card.
Card Features - The Rewards 660 Visa Card is designed for those with poor or no credit and has minimal criteria for approval. An initial payment of $40 is required before you can use it. You also need proof a gross monthly of $1,000 and above to qualify. You are eligible for a $75 credit limit increase once every 3 months. The maximum credit limit is $2,000.
Cost and Fees - As with most cards targeted at the sub-prime market, there are higher than normal costs involved. There is a one-time account set-up fee of $97.00 and one-time program fee of $90.00. The annual fee is $48.00 and the participation fee is $15.00 per month, which works up to $180.00 per year. Your starting credit limit will be $300.00 and the following fees will be billed to your first month's statement: Annual Fee of $48.00, one-time Account Set-Up Fee of $97.00, one-time Program Fee of $90.00, and monthly Participation Fee of $15.00. You will have $50.00 of credit after these charges at card issuance. You must make an initial payment of $40.00 before you can activate and use your Account. After your payment has cleared and posted to your Account, your available credit will be $90.00.
APR - The APR is a fixed rate of 19.92%. The Rewards 660 Visa® uses the average daily balance method (including new purchases) to compute your monthly balance. The grace period is 25 days. The monthly periodic rate is applied to the average daily balance to compute your finance charges rather than the daily periodic rate used by most credit cards. (which means that your true effective APR is lower than another card with identical APR using a daily periodic rate).
Peer Comparison - Before the 2008, financial crisis, there were lots of other cards by sub-prime issuers (most notably from CompuCredit). Example of such cards include Imagine, Tribute and Aspen. As far as fees were concerned, the Rewards 660 fees ranks as one of the highest among these issuers. However, most of the cards we just mentioned do not exist anymore today. The reason is because the FTC has sued many of these issuers for fraudulent marketing.
There are only two active unsecured subprime cards that we know of today. There are the First Premier Bank and Credit One Bank. The First Premier Bank cards have different fees for the first and subsequent years. For the first year, you have to pay a one-time application fee of $95 and an annual fee of $75. From the second year onwards, the annual is reduced to $45 but you have to pay a monthly processing fee of $6.25 a month or $75. Hence, the total cost from the second year onwards is $120 annually. The APR is 36% (which is probably the highest we have seen in any card though First Premier has gone as high as 79%).
The Credit One Bank has an annual fee that ranges from $0 to $99. There is no monthly maintenance fee. The APR ranges from 19.49% to 25.49%. The thing that Credit One has a cash back program.
Verdict - The Rewards 660 Visa Card will appeal to those with poor or no credit. One of the favorable points of this credit card is the fact that they use a monthly periodic rate rather than a daily periodic rate to calculate to finance charges. The other is that the grace period is 25 days. However, the fees that you have to pay for this card is very high. But for the high fees, approval is quite good even for those who have baddies and things like charge offs on their report.
However, the Rewards 660 Visa is no longer available in the market. The alternatives available really depend on your credit situation. If you have collections and charge offs that are not settled or paid, or if you have just emerged from bankruptcy, then your best bet will be to get a secured card like First Progress Secured Credit Card, which reports to all three bureaus.
If you your collection accounts and charge offs have been settled and paid off (or even got removed from your report), if you have not applied for credit the last 6 months, and if you have been timely on your other secured card or auto loan payments, you might have a shot at a couple of no annual fee unsecured cards from Barclays Bank like their rewards card and the NFL card. Check out what consumers have to say about these cards - here.
If that fails, then your next best bet would be the Credit One card. For best chances of approval, make sure you have to unsettled charge off or collections.