MACY's Card Financial Disclosure ..."actual ANNUAL PERCENTAGE RATE charged... 53.88%"

[Blackhatjack]

Macy's had some deep discounts before and after Christmas, but you had to use your Macy's Card to take advantage of them. I made a small purchase, and got a recent statement with the following financial disclosure:

"A FINANCE CHARGE in the amount of $1.00 will be added to your Revolving account balance if you choose to pay less than the full balance by your due date. If that happens, the actual ANNUAL PERCENTAGE RATE charged on that account is 53.88%"

Otherwise the typical Financial terms apply: "Daily periodic rate 0.06274%" and "ANNUAL PERCENTAGE RATE 22.90%"

And so now we know how they can afford to offer merchandise at deep discounts AS LONG AS YOU USE YOUR MACYS CARD.

[YOY]

1. They pretty much have a rediculous APR.

Well known fact. That's why if you happen to use it...pay it off right away.

[Blackhatjack]

3. Exactly. However, the disclosure didn't come until after the purchase was made...

The timing of the disclosure means some people had no idea until they loaded up their cards.

[nichomachus]

4. If you're sure it wasn't made before -- check the fine print -- you may have a good class action

You might want to double check their promotional literature -- if they failed to disclose this rate, check with a class action law firm. They stay awake at night dreaming of things like this -- and all they need is one person to start the action -- at no cost to you.

[Blackhatjack]

6. It's covered under the cardholder agreement, but the actual amount isn't disclosed until post sale

When you accept the card the cardholder agreement basically says they can change the rate and terms anytime they want.

The point I was making is that the solicitation of sales at deep discounts is dependent upon them recouping those amounts in the way of sky high interest rates by requiring you to use their store credit card.

It's a shell game ...

[nichomachus]

7. If you think it's a shell game, check it out with a lawyer

You can google class action law firms -- send them an email. They'll tell you right off if you have a case or not.

I did - and am in the beginning stages of a class action suit against a major US corp.

They may not be able to change the rate on purchases already made -- although they could do it for future purchases. A lawyer could tell you. To do it the way your describe seems a lot like bait and switch.

[nichomachus]

2. One problem is

that while many states have usury laws on the books, these laws only govern the interest rates on loans.

Retail revolving accounts have been exempted from the law. They can charge whatever they want.

This is in CA -- it may differ in other states, and probably does.

[supernova]

5. Store card offers make shopping a PITA

Whenever a sales clerk asks if I want to open a store card account, I ALWAYS decline.

I love shopping. I love browsing. But paying for stuff is painful now because of all the "No, thank yous" I have to spew just to get them to ring up my stuff.

That they push this behavior on low level clerks is even more ridiculous. :grr:

[YOY]

8. But they give them a whole 5 to 10$ bonus and a gold star when they push enough!

Isn't that good enough for you?!?!? :sarcasm:

[tblue37]

9. I go ahead and sign up for the cards, to get the usual 15%

discount on the merchandise I buy that day. Then I pay the card of completely and don't use it again.

[myrna minx]

10. Please send a scan of this to:

http://www.newcreditrules.com/

This fellow is fighting back against AMEX and has become quite the consumer advocate/educator as a result of AMEX treating him like a deadbeat.

[Metta]

11. Executives should be in jail for usury, at least.

There oughta be a law.

[Spider Jerusalem]

12. The answer to that is to pay the balance off by the due date.

If you can't do that, then learn to live within your means.

[jazzjunkysue]

13. I've never let my balance sit, so I never knew that!

I've got all my cards at 0. Everyone needs to do that. Let's put some of them out of business. It's mostly automated and overseas, so it won't impact american jobs all that much, anyway.

[FarCenter]

14. I think that it means that the

$1 penalty plus normal interest at 22.90% is equivalent to 53.88%.

My guess is that your purchase was about $40?

[pacalo]

15. Did you know that Macy's employees are given cash rewards for opening accounts?

A friend of mine who worked there said that she made $1.00 on each new account & that the more accounts employees opened, the higher the dollar amount went for each account thereafter a certain point.

She said one woman opened up around 50 on opening day & that her cash award was in the hundreds.

This tells me that the credit cards are the store's bread & butter.

[shadowknows69]

16. I think it's now officially cheaper to go to the Mob for credit

[defendandprotect]

17. Credit cards like this are crime -- non-productive/middle-man crime . . .