Credit repair cards can cause more misery

So called “credit repair cards” often cause more misery for borrowers, instead of the anticipated relief and elimination of bad credit. The cards generally provide a small line of credit, typically a few hundred dollars, but sometimes no more then $100.
 

They are aimed at consumers who have missed mortgage payments or payments on other loans and credit cards. The current recession has created many such situations and consumers are wondering how to rebuild credit.

The cards providers say that they give borrowers an opportunity to show that they can manage credit and if they do they are rewarded with lower interest rates and/or higher credit.

Many of the cards however have an innitially very high interest rate, often as high as 35% if not 40%. The typical apr of a credit card is about 16% but often lower.

Experts say that the credit repair market is practically impossible to monitor and that providers don’t like to show their interest rates to avoid spotlight shown on them. For consumers, this means hunting down the best deals becomes very hard!