5 Credit Cards You Don’t Want In Your Wallet

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Sometimes all credit cards can seem alike — or, at least, not different enough to spend a lot of time trying to figure out their differences. We sympathize with the sentiment, which is why we periodically try to cut through the clutter and, based on insight from impartial experts, highlight some of the best cards out there. Depending on your needs and spending habits, some cards are indeed sometimes better than others.

But the flip-side is also true: Some cards are worse than others. CardHub.com recently sifted through more than 1,000 credit cards to determine which offer the least appealing trade-off between, on one hand, perks, rewards, and services and, on the other, fees and interest rates. We also contacted some other credit card experts to find out their least-favorites. Here’s what we found:


Visa Black Card: It’s modeled after the American Express Centurion (aka “Black”) card, but this one, issued by Barclays, is more likely to put you in the red. It comes with a hefty $495 fee — and you don’t really get all that much for your money, according to CardHub, which labels it the worst general consumer credit card for rewards among the 1,000-plus it evaluated. Cardholders earn a measly one point per dollar spent, while many other rewards cards offer 2 points per dollar (and don’t charge you nearly $500 a year, either). And while we’ve seen many penalty interest rates that hover near the 30% mark, the Visa Black takes it over that threshold, with a default rate of 30.24%.

Yes, you get access to airport lounges along with some other perks, but there are plenty of cards that offer airport lounge access and similar benefits for less than $495. CardHub calls it a “cheap imitation” of the AmEx Black Card.

(MORE: Do Credit-Card-Comparison Sites Work As Promised?)

Best Buy Reward Zone Credit Card: As a rule, retailer-issued cards aren’t so hot. They tend to have relatively low credit limits (which can hurt your credit utilization ratio if you come too close to maxing them out) and high APRs. Even so, some stand out as particularly unworthy of space in your wallet. The Best Buy card is one of these, says Curtis Arnold, founder and CEO of CardRatings.com. The rewards program is decent, he says, but the credit card is another story. “We have heard consumer complaints about this card for years,” he says, noting in particular its strict rules that can saddle you with potentially huge amounts of accumulated interest. “Watch the ‘special’ 0% financing offers,” Arnold warns. If you don’t pay your entire balance off by the end of the promotional period, which can be as short as six months, or if you make a single late payment, that hefty APR can really trip you up. “Interest will be charged retroactively back to date of purchase — ouch,” Arnold says.

The interest rate is high, too: Depending on your credit, the APR is either 25.24% or 27.99%, and the default rate is 29.99%.

UBS Preferred Visa Signature Credit Card: Another one in the what-am-I-paying-for-anyway? files, this card also charges $495 a year for the privilege of carrying it. The benefits it touts, like no foreign transaction fees and accelerated rewards on gas and groceries, can be found on plenty of other cards that don’t cost nearly as much.

The hefty cost of ownership doesn’t end with the annual fee. CardHub says this card has the highest introductory balance transfer APR — 9.99% — of all the cards it evaluated, and it also charges a separate 3% balance transfer fee. For that, you’d expect a long period of lower interest, but this intro period only lasts six months before the regular APR of 13.24% kicks in.

(MORE: Your Credit Card Rewards Aren’t Worth As Much As You Think)

Apple Barclaycard: “I know everyone loves Apple but you shouldn’t love their credit card,” says John Ulzheimer, president of consumer education at SmartCredit.com. The current APR on this Visa card, which is issued by Barclays, is a variable 22.99%, even if you have stellar credit. Like the Visa Black card (also issued by Barclays), the penalty rate on this card is a whopping 30.24%.

The card does offer 0% introductory financing for 6 months on purchases under $999, or for a year on purchases over that amount. We get the impression, though, that Apple really, really doesn’t want you to transfer a balance onto the card. The APR for balance transfers is 22.99%, on top of a 4% balance transfer fee. “If you fell out of a tree you’d hit a half dozen credit card offers with 0% rates on balance transfers on your way down,” Ulzheimer said.

First Premier Bank Gold Credit Card: “A lot of the worst credit cards on the market are for people with bad credit,” says Adrian Nazari, founder of CreditSesame.com. “In general the fees on credit cards for people with bad credit are extremely high and can eat into a starting balance.”

The First Premier Bank Gold Credit Card was one that most of our experts flagged in particular. In addition to a 36% APR, it charges an initial “processing fee” of $95 and an annual fee of $75 for the first year and $45 in subsequent years. On top of this, it throws in monthly “service fee” of $6.25 after the first year — which means that even though the annual fee goes down, you’ll be paying an additional $75 per year. It even charges cardholders a “credit limit increase fee” of 25% of the amount of the increase. Even if your credit is poor, you can likely do better.

MORE: 5 Weird Reasons You Might Get Rejected for a Credit Card

16 comments
HollywoodF1
HollywoodF1

And they say "stainless steel" like 5 times in their ad.  How tool-tastic do you have to be to give a crap about that?  Besides, for $500, it could be 10 K Gold.

shuklapvs
shuklapvs

Visa Black from Barclays is the worst, apr of over 30% penalty, $495 annual fee. Lounge access is a hoax after a while they don't allow you access. Furthermore when I went to close the account they did not post my rewards thus giving me an ultimatum of accepting 495 fees and realize rewards or forfeit rewards. Ultimately closed the account forfeiting reward points.

dorkworld7
dorkworld7

I am sorry, but using the example of retroactive interest is not very good. If you can't pay your debt off on time or by the end of the promotional period, maybe people shouldn't be buying things out of their budget. It's not the credit card's fault you overspend and promise to pay people off on time. That's probably why they implemented the fees in the first place.

julius
julius

hi im Julius jones right now I am trying to get out of this debt with my car credit card and line of credit I have great credit also im looking for a way that I can get out of debt and pay the lender all they gave me in years of payments as long as I can handal it should I use the black card to get me out of debt

GRuss77
GRuss77

DeweySayenoff - believe it or not, there are still people out there who know the meaning if the word discipline. I use my credit card for everything and leverage the benefits they afford (points, cash back, travel and purchase protection, etc.). You can live within your means and still use credit cards. My credit score is exceptionally high and I pay no fees for any of the cards I carry.

DeweySayenoff
DeweySayenoff

Why do people still use credit cards for routine things?  I mean, sure, you can pay it off every month (though many pundits say that actually hurts your credit rating), but so what?  you still pay for the privilege with fees and God forbid you miss a payment.  Not only do you get hit with late fees and automatic increases in interest rates, plus possibly having to pay an annual fee if there isn't one already, your credit rating gets dinged.

Credit cards stack the game against you.  Less in your credit rating than in your pocketbook - paying a lot for the privilege of paying it off at the end of the month.  Why not just pay what you need to pay with a debit card?

Okay, you have SOME protections with a credit card, but debit cards, depending on the institution, often come with the same or better deals.  My debit card will repay me everything should I be a victim of fraud (and I was).  If that had been a credit card, I'd be liable (in most cases) for the first fifty dollars.  That's how the game works against you.

The wealthy, who don't NEED credit cards, can negotiate great deals on them.  The rest of us who are actually human without Swiss bank accounts should just pay them off and never get one again.  I've been without a credit card for more than seven years.  When the Recession hit, I had no debts. 

You only really NEED credit to buy a house or a car.  BOTH can be negotiated.  Otherwise, living within one's means - not always easy but FAR better than not - is the best way to deal with life.

johnulzheimer
johnulzheimer

And the access to airline clubs that you get with the Visa Black Card is limited to only a few visits, not unlimited.  After you've used your free visits you have to pay for the access.  

MudSlinger
MudSlinger

Use the English language much?

I've got a few extra commas and periods I could loan you if you like?

amit1gandhi
amit1gandhi

@julius no, a card that has a HIGH APR, relatively high annual fee, and crummy rewards its not one to use to consolidate debt. not to mention the fees you would get hit for doing balance transfers -- 

if you have decent credit look at (not in any particular order):

1)  0% intro APR credit cards for 12-18 months min -- you will likely get hit with balance transfer fees -- but may be worth it IF you pay it off in within the intro period...

2) a low interest rate Personal Line of Credit (which will likely have no balance transfer fees)...

3) consolidate into a fully amortized personal loan which will hold higher payments but you will be sure to pay it off...

4) if you own a home and have a reasonable amount of equity consider a cashout refinance or a home equity loan/line of credit


Goodluck.

congoboy
congoboy

@DeweySayenoff You probably dont own or run a business, as an owner of a small business I can give you three, invaluble reasons, #1 people like to screw people, with a credit card payment if you don't get what you payed for you will dispute it with your credit card company, and if they see your point boom they charge it back to the shady guy and you don't pay! try getting your money back from a shady guy if you payed with cash or check! #2 the IRS likes to see documentation for itemized expences, what better proof and organizational method do you have than a itemized credit card statement, #3most credit cards offer rewards for spending money through them, without an annual fee mind you!, now if I'm running a quarter or a half million dollars worth of expences through my business every year, why not take that extra grand or two of reward money I wouldn't see if I was paying by cash or check, now I pay my card in full every month so I dont pay interest I only earn it! Not to mention paying the card every month is a good way to scrutinize were all your money is going and to have a handle on where you might cut back, also a good time to check for any errors or charges you did not make.

CalvinDeCosta
CalvinDeCosta

@DeweySayenoffI've used my Amex credit card to my advantage by collecting points as I spend. I've flown (both domestically in the US and internationally to the UK) for FREE using points, as a result of using a credit card.

I pay off my CC in full every month, so I'm good. I also get the benefit of the Amex concierge who have booked flights and car rentals on my behalf for free (as per my instructions).

So, what I'm saying here, is if you are smart, you can use a CC to your advantage an do 3 things:

1) Pay for your purchases at least 30 days after you've bought the product (since it's on a CC)

2) Collect points and get free or very cheap flights (plus use them for concierge purposes)

3) Since you'll be paying your bill off in full, you'll get a very good credit rating which can be used for your lifetime.

To your point about living within's one's means: I totally agree. But you have to be smart about a CC and most people see it as a ticket to buy stuff they really can't afford in the first place. I don't use it like this, and quite frankly, I advise everybody to NOT use a CC in this way.

Calvin

MudSlinger
MudSlinger

An airline club? Seriously? What do you do, sit around with others in your "club",  make paper hats, secrete hand shakes and signs that say "no girls" ?

<Huge exagerated eye roll...>