Like many Americans, I spend too much. I got an offer in the mail from PSECU offering a low interest consolidation Visa. I took the offer and paid off my American Express card. My plan was to pay down the loan over 12 months. The problem is, if you use the credit card, you are charged a much higher interest rate. If you try to make extra payments, they apply them to your low interest rate.
Effectively, they hold your high interest balance hostage while you pay off your low interest balance. Needless to say, this is predatory. It’s a scam with a calculated risk of how many people will notice, etc. They lure you in with the promise of a sound financially responsible debt reduction plan, but then keep you from selecting which balance you want to apply your payments to.
Fortunately, I caught the scam early and only racked up a small credit card debt, so I won’t be hit too hard. The PSECU representative assured me that they weren’t trying to swindle me and this policy was disclosed in the fine print. I told her I wonder if she believes in her heart that this isn’t predatory.
The reason this is so disheartening is, PSECU has a wonderful reputation. They’ve always been very honest and this is more than just a financial disappointment (I’ll be opening a new consolidation loan and cancelling all of my accounts with PSECU) but it’s a personal disappointment. I always felt like PSECU was my best kept secret, the one honest bank among scoundrels. PSECU is now officially a predatory banking institution. I have a blog and I wanted to let you know.
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Your innocence is charming. Those of us older and more grizzled live paranoid, with leather skins, get multiple credit cards and play them against one another. We yell victory as they pilfer our last penny with fine print. You require a more advanced degree, Doctor, to understand this math.