@Chris679 wrote:
@TheGardner wrote:I do get that, but over 15% still seems high considering AF/Processing Fee and the additional 5+% APR for a couple percent "Reward" ?
Of course paying in full minimizes the additional APR but still doesn't feel like these cards are "Prime".
Chase/Citi/BofA has reward cards for 13.99 as do several other banks and credit unions that are considered less than prime.
Paying in full doesn't minimize the additional APR, it completely eliminates it. My credit union has a card with 7.75% APR that they hand out to anyone who wants it pretty much. Its great if you want to keep a balance but a joke in every other way compared to BCE or most of the good rewards cards out there. And it's not just the rewards that make those cards appealing. AMEX for example has a laundry list of card member benefits that go far beyond just the rewards (which are great too).
If you want to know the difference between one of the "prime" cards and something like my CU card, try to dispute a charge sometime or get a defective item replaced by the manufacturer.
Product replacement is a product of the card processor (Visa, MC, Amex, Discover) Has nothing to do with the CU being a lesser bank or not "Prime" . In this analogy anyone other than Amex is not prime (maybe discover as most CU/Banks offer V/MC).
@longtimelurker wrote:As has been said in this thread, and frequently on this forum (by many, including me), "prime" as used for a lender is pretty meaningless. I think here people are trying to track their progression from the First Premiers of this world into more conventional cards, as a part of a natural competitveness, then want to know if, for example, Barclays is less prime than Citi.
As said on page 1 I think, it's the customers who are subprime (or rather, have subprime credit records) or otherwise. People with low subprime scores have to use secured cards or pay high fees to FP/Credit One etc. As a matter of history, some companies specialized in various segments, but most, to stay competitive, try to serve a range. So Capital One, the fried (really!) of those with subprime scores, also offers cards for its definition of excellent credit, such as Venture and versions of QuickSilver.
Amex, which used to be more exclusive, will give charge cards to pretty low scores these days, and the UW for some of the credit cards has also decreased.
So I would reserve subprime/not prime to the vendors who market almost exclusively to that segment of people, usually indicated by a slew of fees up to those permitted by law, and a good indicator is monthly fees. Almost everyone else is a mixture of prime/high-to-medium subprime with a few only supporting prime and up.
But to the OPs point, there isn't usually a direct correlation between APR or even rewards and the target audience of the card. However, I think there is with fees that don't correlate to rewards!
I guess that's more my point, I am not sure the fees are warranted and proportional to the rewards. AF/FTF/APR all add up and as stated, they make alot more than the rewards cash back and feel the market isn't competitive enough.
I agree with your summation of lenders with basically all ranging in prime to mid/high sub prime cards. So the term prime card is just watered down IMO and truly includes everyone outside of true subprime lenders (FP/Credit One and some would argue Cap One although with resent CLIs going around may change?).
Thanks for the discussion everyone.
