According to the weekly Credit Card Rate Report the interest rates on opening offers for new credit cards fell during the past week, partly due to a severe drop in the APR of the most expensive card in the survey.
The APR (annual percentage rate) average dropped to below 15% to 14.95% which is the lowest it has been since early in September. This after it reached a staggering high of 15.22% in the middle of December.
First Premier is a bank that targets credit cards at people who have a poor credit rating and they are the ones who set the average falling by adjusting the APR on its gold MasterCard to 36% from a high of 49.9%, even though this is a big drop it is still the highest APR of all the credit cards. These rates are not the highest that First Premier have offered though as at one point they hit the headlines when launched a credit card with a staggering 79.9% APR.
These changes have come on the back of a very difficult year for First Premier, they had to make hundreds of employees redundant in the summer of 2011, this was followed by the issuer suing the Federal Reserve and the new Consumer Financial Protection Bureau because of a rule that restricted the upfront fees attached to credit cards.
The Credit Card Act of 2009 stops upfront fees from totaling more than 25% of the total credit available in year one. Then the Federal Reserve added a rule that said that the fees that are added for someone who is waiting to be approved, such as an application fee as an example should be capped at 25%. But First Premier who did charge an application fee refused to accept this rule stating that it was contradictory to what the Card Act was put in place for.
A temporary injunction by a U.S. District Court in South Dakota the home of First Premier was granted stopping this rule from being enforced until the courts come to a final decision. Although no one is sure when this is likely to happen and in fact it could take as long as two years before a definitive decision is made.
First Premier declined to comment on the case.
Since the lawsuit filed by First Premier Bank and Premier Bankcard against the Federal Reserve Board and the United States Consumer Financial Protection Bureau is still in progress, we are not at liberty to make any comments at this time,
said First Premier spokeswoman Meranda Sylliaasen.
Similar Credit Card News:
- [August 15, 2011] First Premier Sues Fed and CFPB Over New Rulings
- [February 23, 2011] First Premier Drops 59.9% APR MasterCard
- [July 8, 2011] Average APR Rising To Second Highest On Record
- [July 13, 2011] Fed Sets Swipe Fee Cap At 21 Cents
- [February 24, 2011] Delayed Interchange Fee Cap
- [August 5, 2011] CFPB Officially Open For Business
- [December 21, 2011] National Average APR At Record High
