Not all plastic is created equal. From the legendary American Express Centurion Card (aka the “Black Card”) for big spenders to $300-limit secured cards for people with bad credit, it seems there are credit cards out there for everyone, whatever your income or financial history.
No one is surprised that high-limit cards for those with near-perfect credit scores offer better deals than those for people who have a blemished credit history. But even within the different categories of credit cards there are good and bad options. A card that sounds swanky may come with hidden fees that make it a money suck, while those desperate for credit can get sucked in by offers that make big promises but don’t quite deliver. Whether you’re looking for a card with big perks or one that will help you get back on your feet financially, check out our list of six credit cards you definitely don’t want in your wallet.
1. First Premier Bank Credit Card
Having bad credit costs you. The average credit card APR was about 15% in July 2016, but cards specifically for those with poor credit carried an average interest rate of nearly 23%, according to CreditCards.com. That means the 36% APR holders of the First Premier Bank Credit Card are charged steeply even by subprime standards. Once you factor in the $95 processing fee, an annual fee ranging from $75 to $125 in the first year (annual fees drop to $45-$49 in the second year), and monthly service fees between $6.25 and $10.40 per month after the introductory period, this card looks like a pretty raw deal. Even if you have bad credit, you may well be able to find a less expensive card from another issuer.
2. Verve Card
The Verve Card is another credit card aimed at those with poor credit. It’s a hybrid card, and may function either like a traditional unsecured credit card or a secured card, where you have to put down all or part of your line of credit as a deposit before opening the account. Along with the similar Surge Card and Matrix Card, which are offered by the same bank, the Verve Card comes with a high 30.24% APR, an annual fee of nearly $100, and a $10 monthly service fee (after the introductory period).
“Don’t bother with these cards,” credit expert Beverly Harzog urged. She ranked them dead last in her list of best and worst secured credit cards.
3. UBS Preferred Visa Signature Credit Card
Just because a card markets itself as elite doesn’t mean it’s a good deal. The UBS Preferred Visa Signature Credit Card comes with an eye-popping $495 annual fee and not much else. Yes, you will earn rewards by using the card, and it comes with perks like no foreign transaction fees, but cheaper cards offer similar privileges, CardHub.com pointed out, when it named this dud one of the worst credit cards out there.
“This card simply doesn’t yield enough value for its annual fee to be a good investment, especially considering how many relative bargains are out there now,” according to CardHub. “There are a variety of cards available that offer more lucrative rewards bonuses, higher ongoing rewards earning rates, and airport lounge access for hundreds of dollars less each year.”
4. JCPenney Credit Card
“Would you like to save 10% of you purchase today?” Retailers use the promise of instant savings to tempt you to sign up for their store-branded cards, but opening a new account isn’t always a smart move. Take the JCPenney credit card. You’ll save 15% on your first purchase with the JCPenney credit card (which unlike some store-branded cards, can only be used at the department store that issues it) but you’ll have to swallow an APR of 27% to get the bonus. You will earn some rewards, but they’re no great shakes. You get 1 point for every $1 spent at the store. After you earn 200 points, you get a $10 reward certificate.
5. Vast Platinum Card
Watch out for this too-good-to-be true Vast Platinum Card, which promises a $1,000 guaranteed credit limit with no credit checks and 0% APR. But here’s the catch: The card can only be used at the card issuer’s online store, and to get the card you have to pay a $20 monthly fee plus a $30 application fee. In other words, you’re on the hook for $270 in fees before you make even a single purchase. The price might conceivably be worth it if you could score big savings at their online store, but you have to already have an account before you can log in and see prices on the website. Plus, the card doesn’t appear to report to any of the three major credit bureaus, according to Ask Mr. Credit Card, so if you’re hoping to use it to rebuild your credit history, you’re out of luck.
6. Luxury Card MasterCard Gold Card
The name certainly sounds prestigious, and the card is plated in 24-karat gold, but don’t let the shininess of this card blind you to its big flaws, the $995 annual fee chief among them. Compared to other elite cards, the Luxury Card Gold MasterCard (issued by Barclays Bank) just doesn’t measure up, according to credit cards expert Mike Randall at CardRates.com.
Though the APR is about average at 15.24% and it comes with some perks like a $200 annual credit you can use toward qualifying airline purchases, $100 credit toward the Global Entry application fee, and 2% cash back, you’d still have to spend a lot to come out ahead, Randall noted. Plus, the points you earned can’t be transferred to other rewards programs, and they’re only good for air travel, not hotel stays or car rentals. As of July 2016, the card didn’t appear to be offering any sign-up bonuses. Frequent flyers who want to maximize rewards would likely do better with another card.