Key Highlights
Here’s a quick look at what you need to know about the worst credit cards.
- The worst cards often target consumers with a low credit score, charging them high fees and interest rates.
- Watch out for cards with an excessive annual fee that doesn’t provide enough value in return.
- Some issuers charge exorbitant processing fees, monthly maintenance fees, and even credit limit increase fees.
- High-interest rates, sometimes reaching 36%, can make it incredibly difficult to pay off your balance.
- Better options, including secured cards and cards with low introductory interest rates, exist for most consumers.
- Always compare the terms and fees before applying to find the best cards for your needs.
The Worst Credit Cards: High Fees, Steep Rates, and Hidden Pitfalls
Navigating the world of credit cards can feel overwhelming, especially when some offers are designed to trap you in a cycle of debt. The worst credit cards list is often populated by cards that come with extremely high fees, a staggering high-interest rate, and very few, if any, valuable perks. These cards might lure you in with the promise of luxury gifts or easy approval, but the long-term cost is rarely worth it.
What makes these cards so bad? It’s a combination of factors, including a regular APR that can be double the national average and a stack of fees for everything from processing your application to increasing your credit limit. Before you sign up for any new plastic, it’s crucial to understand what makes a card a poor choice.
1. First PREMIER® Bank Mastercard Credit Card – Exorbitant Fees and Low Limits
The First PREMIER® Bank Mastercard Credit Card is a prime example of a card that can be costly, especially for those trying to rebuild their credit. This issuer is known for its aggressive fee structure, which can quickly eat into your available credit and make managing your finances more difficult. If you’re looking to improve your credit score, this is likely one of the worst credit card options you could choose.
The card comes with a 36% interest rate, which is one of the highest on the market. In addition to this steep rate, you’ll face a series of fees before you even use the card. These costs add up, creating a significant financial burden for someone who may already be in a tough spot.
Here’s a breakdown of the potential charges:
- Processing Fee: A one-time fee of $55 – $95 before the account is even open.
- Annual Fee: A first-year annual fee ranging from $50 – $125.
- Monthly Fees: You could also be charged monthly fees, further increasing the cost of holding the card.
2. Credit One Bank® Platinum Visa® for Rebuilding Credit – Hidden Charges and High APR
When you’re working to improve your credit score, you might come across offers like the Credit One Bank® Platinum Visa® for Rebuilding Credit. While it’s marketed to those with less-than-perfect credit, it’s important to be wary of hidden charges and its high APR. Cards from this issuer can sometimes come with a confusing fee structure that makes them a less-than-ideal choice for rebuilding credit.
What should you look out for? One of the biggest mistakes to avoid when choosing a credit card is ignoring the fine print. This card often carries a high regular APR that can make carrying a balance very expensive. Furthermore, the annual fee can vary and might be charged monthly, which can be an unwelcome surprise if you’re not expecting it.
Be mindful of these potential costs:
- High APR: A high interest rate that makes it difficult to pay down debt.
- Annual Fee: An annual fee that may be billed as one lump sum or broken into monthly payments.
- Balance Transfer Fee: If you plan to transfer a balance, expect to pay a fee that adds to your overall cost.
3. Indigo® Platinum Mastercard® – Sky-High Annual Fees for Poor Credit
For consumers with poor credit, the Indigo® Platinum Mastercard® might seem like an accessible option. However, it frequently appears on the worst credit cards list for a reason: its fee structure. This card is known for charging a sky-high annual fee without offering the rewards or benefits to justify the cost. How can you tell if you have one of the worst credit cards in your wallet? A high annual fee paired with a high APR and no rewards is a major red flag.
The primary issue with the Indigo Platinum Mastercard is that the annual fee can be substantial, depending on your creditworthiness. This fee reduces your initial available credit, giving you less spending power from the start. Combined with a high regular APR, carrying any balance on this card can become a costly mistake.
Consider these potential drawbacks:
- High Annual Fee: You may be charged an annual fee up to $99, which is high for a card with limited benefits.
- High APR: The interest rate is typically on the higher end, making debt repayment a challenge.
- No Rewards: You won’t earn points, cash back, or miles on your purchases.
4. Milestone® Gold Mastercard® – Unjustifiable Costs and Limited Rewards
The Milestone® Gold Mastercard® is another card that targets individuals with less-than-perfect credit. While a “gold card” might sound prestigious, this card’s terms are anything but luxurious. It’s infamous for its unjustifiable costs and extremely limited rewards, if any are offered at all. The impact of having one of the worst credit cards can be significant, as high fees and interest can harm your financial health and credit score over time.
This card, from issuer Genesis FS Card Services, often comes with one of the highest interest rates available, climbing to nearly 36%. What mistakes should you avoid when choosing a card? Don’t be swayed by a fancy name; always look at the numbers. The combination of a high annual fee and a punishing APR makes this card a poor choice for nearly everyone.
Here’s what to watch for:
- Extreme Interest Rate: A regular APR that can reach as high as 35.99%.
- Significant Annual Fee: The annual fee can be as much as $99, depending on the specific offer and your credit profile.
- Limited Rewards: Unlike other cards, you won’t find a meaningful rewards program here to offset the costs.
5. Surge® Mastercard® – Predatory Interest Rates and Monthly Maintenance Fees
The Surge® Mastercard® is often considered a predatory credit card due to its combination of high interest rates and multiple fees. This worst card contender charges not only an annual fee but also a monthly fee in many cases, which quickly adds to its overall cost. These fees can make it an expensive tool for anyone, especially those trying to build or rebuild credit.
Which credit cards have the highest fees and interest rates right now? The Surge Mastercard is certainly a top contender. Its fee structure is designed to maximize revenue for the issuer at the expense of the cardholder. The regular interest rate is also typically very high, making it difficult to escape debt if you carry a balance.
This comparison table highlights how its potential costs stack up against another card known for high fees:
| Feature | Surge® Mastercard® (Typical) | First PREMIER® Bank Mastercard (Known) |
|---|---|---|
| Regular Interest Rate | Up to 35.99% | 36% |
| Annual Fee | $75 – $125 | $50 – $125 (1st year) |
| Monthly Fee | Up to $12.50/month | Up to $10.40/month |
Common Features of the Worst Credit Cards in the U.S.
The worst credit cards share several common traits that make them financially draining for consumers. These cards are notorious for excessive fees, including a high annual fee, monthly maintenance charges, and even application processing fees. They often come with punitive rates that can trap you in debt, and many have sneaky penalties for things like credit limit increases.
Certain credit card issuers have become known for offering these types of products, specifically targeting individuals with lower credit scores who may have fewer options. Instead of helping you build credit, these cards can make your financial situation worse. Understanding these common features is the first step to avoiding them.
Excessive Annual and Monthly Fees
One of the most telling signs of the worst cards is their fee structure. While many excellent credit cards have an annual fee, they typically offer rewards and benefits that justify the cost. The worst offenders, however, charge a high annual fee without providing any meaningful value in return. Worse yet, some add a monthly fee on top of the annual one, double-dipping into your pocket.
These fees are particularly harmful because they are charged regardless of whether you use the card. For someone looking to build their credit score, these costs can be a significant setback. Imagine paying over $100 per year just for the privilege of holding a card with a low credit limit and no rewards. This kind of financing makes no financial sense.
Ultimately, what makes a credit card one of the worst is how it preys on those in vulnerable financial positions. Before accepting any offer, calculate the total annual cost by adding up the annual and monthly fees to see if it’s truly worth it.
Punitive Interest Rates and Sneaky Penalties
Beyond fees, punitive interest rates are a hallmark of a bad credit card. A high regular APR, sometimes as steep as 36%, can cause your balance to balloon quickly. This makes paying off debt incredibly difficult, even if you’re making regular payments. While 0% intro APR offers on balance transfers can be a great tool, the worst cards often provide very short introductory periods, if any at all.
What truly sets these cards apart are the sneaky penalties hidden in the fine print. For example, some cards charge a fee—often a percentage of the increase—simply for raising your credit limit. You might also find high late payment fees and returned payment fees that add to the financial strain.
These features all contribute to making a credit card one of the worst options available. A good credit card should be a tool to help your finances, not a trap that drains them with high interest rates and unexpected penalties.
Frequently Asked Questions
What common features make a credit card one of the worst?
The worst cards typically have a combination of extremely high interest rates, excessive fees (like a steep annual fee and monthly maintenance charges), and a lack of valuable rewards or benefits. Some issuers also include sneaky penalties for things like credit limit increases, making them costly for any consumer, especially those with a low credit score.
Is it easy to switch from a bad credit card to a better one?
Yes, switching is straightforward. You can apply for one of the best credit card offers that fits your improved credit score. Once approved, you can start using the new card. However, avoid closing your old account immediately, as this can lower your credit history length and temporarily hurt your score.
What is the most overrated credit card?
The Mastercard® Gold Card is often considered one of the most overrated cards. It carries a massive $995 annual fee but offers rewards and perks, like a vague promise of luxury gifts, that don’t justify the cost. For far less, a card like the Chase Sapphire Preferred offers more valuable and flexible rewards.