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How to spot a predatory credit card offer

Before the housing market collapsed under the weight of bad loans back in 2008, most people hadn’t heard that much about predatory lenders. Even today, predatory lenders are usually associated with inflated mortgages and payday loans — but predatory lenders who use deceptive practices to bait and hook hapless consumers have always been around.

You may even have a few predatory loans lurking around in your wallet in the form of credit cards from lenders who are more than happy to take your money and hit you with exorbitant fees when you least expect it.

How do you spot a predatory credit card? It isn’t easy (by design), but here are some clues:

  • You got the credit card offer in the mail, despite problems with your credit. There are a whole host of companies that offer credit to “subprime” borrowers. They bank on the fact that many of those consumers aren’t financially savvy enough to realize what they’re getting into.
  • You’re being charged outrageous yearly fees. While not every card that charges a yearly fee is bad, consumers need to see if they’re actually getting anything for that fee in return. Otherwise, you’re just paying the company to carry their card.
  • The interest rate is ridiculously high. Sometimes a card will offer a low interest rate for a few months, but the fine print reveals that it will escalate shortly afterward. Others don’t even try to hide the outrageous interest of 25% or more — they know that some people will either overlook it or take the offer anyhow.

It’s always best to look carefully at a company’s offer and reputation before you accept a credit card offer. Just the same, if you’re already in trouble, it may be time to talk to an attorney about your debt relief options.