Overall, Citi may have proven to be the worst credit card company this year as hundreds of visitors have shared horror stories about interest rate increases of up to 29.99%.  And these are customers with good credit.  Despite these increases, there are worse credit cards than those offered by Citi.  So while I’d love to crown Citi the worst credit card company, the (dis)honor ultimately goes to First Premier Bank.

If you have good credit, you’ve probably never heard of this company or taken a look at their credit card offerings.  However, if you have searched for a credit card for bad credit, you’ve probably come across these offers.  And believe me, these cards make Citibank look as good as Discover Card, which is likely the best credit card company of the year.

What makes First Premier so bad?  First, the account set up fee.  It clocks in at $29.  Then, there is a one time program fee (not entirely sure what this fee is, but its there).  This fee will cost you $95.  Of course, there’s an annual fee.  That comes in at $48.  And to make things interesting, there is a $7 monthly serving fee which adds up to $84 a year.  Want to see your account online?  Add another $3.95.  And if you want to pay online or by phone, expect to pay between $7 and $11.

When you add these fees up, you get $256 which accounts for 50-85% of the credit limit provided to most customers.  Now, the interest rate puts Citi rates to shame.  Its only 9.99%.  However, the $256 annual fee is higher than that of the American Express Gold and Green cards put together.  And those are great credit cards with rewards programs.

Were it not for this fee trap aimed at consumers with bad credit, Citi would have easily won my vote as the worst credit card company.  But until they tack on absurd fees, the honors go to First Premier.  Now, as to the most unfair, unreasonable, and irresponsible credit card company, that’s honor Citi takes with ease.

What brought these nasty credit card tools to my attention today was a horror story posted by a recent visitor.  She used a 0% cash advance check to pay down some high interest bills.  Unfortunately, the bank that mailed her the cash advance check decided to lower her credit limit before the check cleared.  This, in turn, caused her to bounce checks to two credit card companies and two utility companies, which will cause her interest rates to increase, cost her hundreds in bank fees, and may potentially damage her credit score.

Now, the situation I read may have been an extreme incident.  However, this story is a stark reminder that credit card companies simply cannot be relied on (or trusted) until the banking sector irons out its problems.  To make matters worse, the person whose financial life was thrown into disarray by a cash advance check complication had used the money in her bank to pay down her high interest balance at the company that issued the check.  She then decided to use the “low interest” check to pay down other bills.  She was relying on her credit limit and the good faith of her credit card company.  Today, we must all spend and act as if our credit limits might disappear tomorrow.

Now, the cash advance check nightmare I just described has surely occurred in lesser degrees to hundreds of thousands of people, as balance transfer checks and cash advance checks that arrive in the mail have more strings attached to them than a spiderweb.  Here are just a few of the nasty fine print tricks that accompany “low interest” credit card checks:

1.)  Very high interest rates:  Banks encourage you to use cash advance checks just like cash.  However, after a generally brief introductory period, cash advances generally have interest rates of 29% regardless of a person’s credit.  And, until the new credit card laws take effect, any payments you make will not reduce the credit card balance being charged 29% until your lower rate balances are repaid.

2.)   Fees:  Most balance transfer and cash advance checks come with 3% fees, although some companies do charge 4% or more.  When you add this onto a 29% interest rate, the costs skyrocket very quickly.

3.)  Cash advance checks (and balance transfer checks) can bounce:  I’ve heard multiple stories where cash advance or balance transfer checks bounced, leading to overdraft fees, late payment fees, and just about every other penalty a bank can impose.  As credit card companies continue to cut credit limits, the possibility of a cash advance check bouncing before it clears increases the chances of this occurring.

Ultimately, cash advance checks and balance transfer checks should go directly to a shredder.  If they were useful for consumers, they would have been pulled from the market by profit hungry banks.  The fact that these are the only offers still entering consumer mailboxes is proof enough that these checks are a tool that makes money for banks or, in other words, an effective way of taking advantage of consumers.

This is the basic deal. The credit card advertises a 0% APR on purchases and balance transfers for 1 year. Individuals that have very good and excellent credit are granted the promoted 0% rate. That’s great for them. But what about those with average credit. They get the second tier offer, which is 0% for 3 months on just balance transfers.

As unfair as this practice is, the dirtiest trick in this process is the enticement to transfer balances. Let’s say you don’t have the greatest credit and you’re looking to transfer a balance from a credit card with a 15% interest rate. You apply for one these cards and, while completing the application, opt to transfer $2000. First, you get charged a 3% balance transfer fee. That will cost you $60. Then, after a lovely 3 months, you find yourself getting charged the same exact interest rate you had on your old credit card. In the end, you might end up saving $20. But in worst case scenarios, you could get slapped with a higher interest rate on your new card than you had with your previous card. If that happens, your money saving balance transfer will actually cost you money.

Fortunately, avoiding this balance transfer trick is fairly simple. Just review the terms on the online application and make sure there is only one introductory rate offer.

You can review offers and apply online for a 0% APR balance transfer on this site. Just remember: READ THE FINE PRINT.