Friday, April 10, 2009

One Leading Indicator Is Up

SAN FRANCISCO - APRIL 21: A sign is seen outsi...

Image by Getty Images via Daylife

I got the first direct mail credit offer I’ve seen in months in today’s mail. They used to come every day, but since the economy melted down – nada. So I guess that’s good news for the economy. Bad news for trees. This was from Bank of America. After hearing all the news about how BofA was planning on burning some customers and dropping others I was curious about what they were offering. This was quite the deal.

This offering was for a loan. I was invited to take advantage of my excellent credit history and help myself to up to $30,000 of Bank of America’s (taxpayers?) money. Preapproved. This doesn’t sound as if they’ve learned a lot. But you can’t beat the terms. They laid out what the payments would be based on various amounts and the length of the loan all based on 8.99%. But, there are a couple of catches. I might not be approved for 8.99%. That’s the lowest APR I can hope for but it might be higher. Also, it’s a variable rate ranging anywhere from 8.99% to 24.99%. Bank of America can adjust the rate any time at their discretion. Correct me if I’m wrong, but that sounds like I could take this loan on Monday and they could hike up the rate on Tuesday if that’s what they were in the mood to do. But wait, there’s more! If I was to fail to pay my full minimum payment or pay it late on any two occasions during a 12 month period (possibly as a result of big rise in the interest rate on a loan I couldn’t really afford to begin with) the rate goes to 27.99% and that, of course, is not variable. That one’s fixed.

So, no thanks Bank of America. I’m going to have to pass, but I’m glad to see you’re back in the business of offering credit to people on terms that are risky to the lender and borrower. It must mean the economy is on the mend. Right?

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  1. 25% interest rate...How can they live with themselves? That dumb question reminds of a Watergate-era Doonesbury, in which a reporter as Nixon press secretary Ron Ziegler what he does in the morning when he looks in the mirror knowing that he's about to begin another day of lying and dissembling. Ziegler's answer: "I shave."

  2. Hell, at least the pirates from Somalia have the excuse that they are poor. And they haven't foreclosed on any mortgages either. I kind of prefer the pirates.

  3. And this stupid screening thing makes me post as anonymous. I'm not anonymous! I'm Roger, Equa Yona

  4. OOPS, figure it out.

  5. They want to make sure you know they are If you pay high interest you will pay it off sooner...or I would guess.. geeze pathetic isn't it.

  6. funny thing with those pre-approved credit offers: I still find them in the mail once in a while, for my late husband, and he passed on quite some time ago! Go figure!