Dangerous card, requiring very responsible usage
Written: Jan 15 '08
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Pros: Easy to get
Disclosure of terms
Cons: High fees, rates, rough terms or agreement
The Bottom Line: I would only recommend this card to someone who really needs to establish/re-establish credit, has done an exhaustive search for alternatives, and can pay their bill in full every month.
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| jehowe's Full Review: Orchard Bank Credit Card |
I've only had this card a little while, and first off, they do allow those of us with bruised credit an opportunity to rebuild and recover. But, like the laws of physics, people with poor credit always pay the most, and Orchard Bank uses every opportunity to take advantage of this.
Most accounts are given credit limits of $300~500, and given the $59 annual fee, this translates to them earning 11.8%~19.6% of you entire credit line right off the bat even if you don't charge a dime. Add in the interest rates of 14.9%~29.99%, and you could end up paying the equivalent of 26.7%~49.67% in interest annually depending upon your line and average balance when you add the two together.
Of course they have fees for everything as well. In these days of electronic clearing, payments for every financial institution that I know of have same day clearing for payments made by a reasonable time of day. Orchard Bank offers this as well, but only for a $12.00 fee, which in my opinion is a complete money grab. They also reserve the right to charge you a fee of 'Up to 50%' of any credit limit increase as well which in my opinion again, is criminal. Their business model seems to steer people into paying the default rate as well. The default rate currently is 29.99%, and can be triggered in a number of ways. Including, but probably not limited to having a payment post one day late, going over your limit, and even for no apparent reason at all. Even if you never use the card, or always pay on time, the default rate can be triggered by what they consider to be something too negative when they periodically peek at you credit file. Given that most accounts are held by people with less than perfect credit, many of them are on the knife edge of getting bumped to the default rate.
If you still finding yourself needing this card, there is only one way to use this card safely. First do not use it for anything remotely like a major purchase that you can't pay off immediately, or puts you within 75% of your limit. Instead make small purchases and pay them off within the grace period (25 days). This way no interest charges will accrue, and even the default rate can't touch you. So always pay your bill in full monthly. You'll be rebuilding your credit and keep a dangerous card from eating you alive.
Recommended:
No
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Epinions.com ID:
jehowe
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Reviews written: 1
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