"Destroy the dominant US subprime credit card business model"

[pazuzu]

"Subrprime consumers will find unsecured revolving credit almost impossible to come by"

Looks as if HSBC's Orchard/Household products, First Premier Bank, and CreditOne may become extinct: 

 CompuCredit on the ropes

Message Edited by pazuzu on 01-22-2009 01:25 PM

edited URL --hauling

Message Edited by haulingthescoreup on 01-22-2009 03:29 PM

[manyquestions]

That could kill the very most subprime that give you 50% fees on the new card.  I think that is a good thing, people don't need a tradeline that bad.  Banks like Orchard with a $75 fee on a $300 limit are right at that 25% fee limit that is mentioned in the article.  All they have to do is start giving $350 limits instead of $300 and they qualify OK.  So I think the Orchard level and above will not have to change much, the very bottom feeders like Aspire, Tribute, First Premier will have to adjust more. I agree with the changes, it won't really be limiting peoples ability to rebuild, those cards allowed people with super bad credit to create positive tradelines but they also created a lot of bad tradelines with all their fees that people sometimes had problems with.

[Anonymous]

Thats what secured cards are for. I'd rather have them than pay those crummy fees every month.  

[Anonymous]

Agreed Pappy!

I used to get offers from banks like that with outrageous fees! I would definately rather have a secured card than pay $125 in fees. Granted my Cap One has a $39 yearly fee attached to it but that is nothing compared to these crazy fees!