In honor of paying off my oldest/highest-interest credit card balance (woohoo, halfway through my CC debt!), I thought I’d share some thoughts on the card issuer—1st Financial Bank, USA. Particularly, why I think it is an exceptionally shady lender that preys on financially-uneducated students. Sure, most credit card lenders are shady, but few target students to the extent of 1FB.
Is there any good?
Before I bash them, I will admit to a couple of good things: they allowed me to found a credit history at age 18 and raised my limit like clockwork every 6 months, allowing me to maintain a decent debt/credit ratio. Except, maybe that latter bit wasn’t that “good.” I mean, do they really expect a college student to have the means to pay back ~12k? No, definitely not, but 1FB can make a decent chunk of fees if one were to charge up that amount. For the record, I never hit anywhere near that limit.
The Bad
They make it hard to pay and hard to know when to pay by providing jumping due dates, outdated Web access, no option for e-statements, no financial education tools, and limited telephone customer service hours. Maybe some research firm told them that it was good business sense for Generation Y to have access to account information via text message, but to lack a robust online portal, who knows, but if they did, they were told wrong. Regardless of my critique of their technological presence, the real issue is that they exhibited about every bad practice outlawed by the recently-passed CARD act, and are retaliating with painful rate increases and feature removal.
Preemptive CARD Act Changes
Two words: 24.99% APR. Yes, in anticipation of the CARD act coming into effect, they raised my interest rate by 10%! in October. 14.99% wasn’t great to begin with, but 25% is usury in most states (but not SD, where 1FB is based). Also, in addition to the general overdraft/late fee raising that most banks are doing, they also removed the one “reward” type feature of the card: 0% on balances below $250 (or $500 for other cards of theirs).
A good thing? They did remove double-cycle billing. Of course, it wasn’t out of the kindness of their blackened hearts; ceasing double-cycle billing is one of the major dictates of the CARD act.
When Is My Bill Due?
On the nth of the month, give or take a week. My due date constantly bounces around. It is generally somewhere early in the month, but has ranged from the 5th to the 16th. It’s a great way to trap the inattentive (or busy!) student into a late fee.
And a newer development: The online FAQ provides the following about information available online:
1FBUSA Online Services provides easy access to the following information about your credit card account: your credit limit, current account balance, amount of your last payment, date last payment received, your available credit, last statement balance and date, minimum payment due, payment due date, next billing statement date, and next billing statement payment due date. Transactions posted since the date of your last statement are also available, …
[Emphasis Mine]
However, after recent site updates, they no longer provide either a next billing statement date or the next due date. It may seem like unimportant information, but I would like to know the exact date I can see the final finance charges due on my account. Not to mention I prefer to pay the account as close as possible to the statement date, rather than the due date.
How do I pay my bill?
Oh, sorry, we’re still in the 20th century. Mail us a check with your statement stub, please. Your bank does online payments? Well, that’s some newfangled thing they’ve never heard of (ok, a little exagerated, they do provide an ACH program you can enroll in), but the bank can send them a paper check instead of an electronic payment. That’s what ING Direct does for me. The downside there is that despite it being free for me (one of the great ING features), it takes about a week to post, depending on the date 1FB receives it, since it doesn’t have the remittance stub with it, just the acct # on the check..
What about paying online or by phone, like most any decent credit card? Sure, for a $9 charge. I guess it’s the lesser of two evils: forget to send your payment and tomorrow is the due date? No problem, just pay $9 to make a payment on their Web site. Think that’s ridiculous? NP, you can just pay the higher late fee.
Want some human compassion/courtesy? Fuggetaboutit.
Don’t get me wrong, I don’t think it’s the bank’s responsibility to forgive fees right and left or for every sob story, but pretty much anywhere will give you one late payment fee pass, especially if you pay on time consistently. Does that include 1FB? Not in my experience, and I didn’t even hit the dreaded 30-day past, report to the Credit Bureaus point, just 15 days or so.
A few years ago, my grandmother passed away during December finals, right before the payment due date. The following two weeks were a mess—flying home for the funeral, flying back to school to finish my finals, driving home for the month break between semesters (and you had to be out, out, out! of the dorms within 24 hrs. of your last final). True, it’s my responsibility to pay my bill, but obviously, I was a little distracted. I forgot to send in payments for both of my cards. Two weeks go by and I realize my mistake, and send in the payments, then make the dreaded call to request forgiveness of the late fee with my story. Chase: “Sorry for your loss, miss. I see you’ve paid on time in the past. We’ll remove that fee right away as a one-time courtesy. Thank you for calling.” 1FB: “Errr, you paid late. That means a fee. You need to pay it. Yeah, you’ve always paid on time before, but it doesn’t matter. Have a nice day.”
Maybe they decided to take the tough-love approach to creating dependable borrowers. Sure.
What Can You Do About It?
If you have a 1FB card, get it paid off (consider transferring the balance to a new company’s card), find a different card to use every day, and consider closing your account. But don’t close it if it is your oldest account—that will likely hurt your credit score. If you don’t already have a 1FB card, don’t get one!
Update: closing the account might not hurt your score as much as they try to make you think it will. Read about how (not) bad it hurt my credit score to close this account in June 2010.
If you’re a just-entering-college student, verse yourself in financial literacy. Don’t use the card except for small things that you pay off monthly. And that advice applies to any card, not just 1FB-issued ones.
If you’re a parent of a young-adult, please educate them on how to handle their finances, and if possible find a way to get them a card with a company that has some sort of conscience, no matter how small it is. Any other bank seems a little better than 1FB USA.
Of course, in a dream world, we wouldn’t need to worry about getting a credit card at 18, but unfortunately, credit history is important once you graduate and enter the real world, and that’s about the only place to start.
I agree 100%! "Oh, sorry, we’re still in the 20th century." – LOL!
On the bright side, I'm glad that they started listing the next statement and next due dates again.
I'm abroad and taking advantage of the fact that they don't charge an international transaction fee (and I am paying the account off monthly, needless to say). Although, they said something about being able to start charging a 3% int'l transaction fee at any time per the cardholder agreement.
I guess I can't complain if they start charging at the end of one billing cycle for charges in that particular cycle (in which case I will notice and stop using the card so much), but if they try to do it retroactively for the whole 4 month period as soon as I get back in June, I will be very upset!
I have had this account for 6 years and I just closed it a couple of days ago. I had a similar situation with my cards and a death in the family and i got absolutely no simpathy. I have never talked to someone with 1FB that was particular nice until…
I was closing the card. They put it on thick when you are leaving, but otherwise there just rude. if you want to get a credit card NEVER go here.
Let’s also not forget about the $9 transaction fee for online payments that was only eliminated about a year ago. Or the $999 limit on web-transactions. Or that they only let you pay up to your last statement balance online, effectively preventing anybody from paying the entire balance that way and ‘earning’ them more finance charges.
I’ve honestly had this credit card for four years now and I was surprised when I saw all the negative reviews on this card. Sure most of the things you mentioned in this article are true and still should be changed like the $9 online fee. But I still have only 16% apr, and I still have my 0% interest on purchases under $250.00. And they did forgive me when I made a late payment and the collection agency was calling me one day after the due date (which I thought was kind of messed up on their part.) The collection agency said they were gonna raise my apr to the default rate of 24.99% and they were gonna take away my special cash back bonus. But after I made the payment and the next day I talked to the customer service representative, he said it wouldn’t happen and apologized to me. That’s the only issue I’ve had with this bank in four years though. Like the author said, it also helped give me a jumpstart on my credit score.
This is the worst company! Run, avoid it at all costs!!
I, like many other people, got my fist credit card while in college many years ago. I unfortunately went with 1st Financial. At the time, there were no real problems, I had a higher than average interest rate, but nothing to worry about and I kept my balance low. After I graduated, my adult life began and my balance increased from moving costs, medical bills, etc. Even at that time, my payments were manageable.
Just a few years ago, they raised my interest rate to an absurd 23% ! I have excellent credit, I have always made my payments on time and pay higher than the min., but at this point it’s becoming more and more difficult to keep up. I pay almost all interest each month and only a tiny piece of my balance. After a number of phone calls to the company I have no explanation other than “that’s the rate the bank has set.” There is no willingness to work with borrowers or even provide reasonable answers.
I’ve had this card for almost 10 years now and it would be a shame to cancel it but that is something I plan on doing. Just look at there website, it’s amateur hour. I originally thought it was normal for the time or under construction, but nothing has changed since I first opened my card…
There are no more rewards, the interest rates are extremely high and the customer service is terrible. There are no real benefits of having a 1st Financial Bank credit card specifically. If you are a college student, take a little time to see what else is out there. It’s worth the wait in the long run. Their current offer is a 0% APR for the first year and then it jumps to 29%. 29% is INSANE! Run from this company!!
I disagree. Companies trap people all the time. Bad business practices? Maybe. But it’s YOUR credit and therefore, YOUR responsibility to remember your payments and the like, and to know that credit cards aren’t free money. Not the bank’s. Is your responsiblility to have your payments postmarked before your due date and to pay off your balance. And if you can’t remember little things like that, and remember to work around the bank’s practices in the intst of building good credit, then frankly, you don’t need a credit card.
I agree!
They constantly harass my parents if I miss a payment. It is my card and my responsibility. They somehow managed to get my brothers number, I do not know how… I am aiming to pay off this card in another year and rarely use it. Going through what I have been going through with them is not even worth it.
I recently enrolled in a program to have automatic payments made to the card 2 times a month. I thought i was being proactive, making sure I’d never miss a payment. But, they neglected to tell me that this meant my account would be suspended from use. The lady who set me up, neglected, and also the letter I received in the mail informing me of the enrollment, SAID NOTHING. Luckily, i will be paying of the entire balance with another card in the next day or so. I will not be closing because its the oldest, but i will be cutting the card into pieces. I will never use it again. See Ya later 1st financial.
1st Financial Bank is outrageous. Their fees are ridiculous and the only reason they get away with it is because they prey on young adults without an established credit history. Cancelling the card wont hurt your credit score as badly as you think it will. The records of your payments will stay on your credit report for the next 7-10 years. After the records fall off, there may be a slight decline in credit score, but it will hardly be noticeable because the reputation you build in that 7-10 years will make up for it so long as you’ve paid your other cards on time. Just make sure you pay off the card entirely before closing the account and make sure to tell the representative to note that the account was closed at your request. Follow up with a written letter and make sure to ask the post office for a deliver confirmation. Then get your hiney over to your local credit union and see what kind of deals they can get you on a credit card. Before closing my 1st Financial account my interest rate was at an outrageous 18.99% My local credit union offered me a card with a rate of 7.99%! Plus since I opened a credit card with them they dropped my interest rate on my car loan from 3.99% to 3.49%
So frustrating. My daughter signed up for this card and all seemed well…until she used it. That’s when we started finding out all the “fun” aspects of the company.
She maxed out the $150 limit with necesities and asked if I could pay it off quick with my credit card instead of waiting for her paper check to get there in the mail. She didn’t want any balance on the card. Fine with me. We registered her online and spent quite a bit of time looking for the payment option by credit card. A call to customer service enlightened us that the only way to pay with a credit/debit card was to call in.
That seemed ridiculous, but so be it. A couple weeks later, I thought I’d jump online and see if she’d bought anything and check her payment due date. I couldn’t log on. And I couldn’t get the password reset to work. A call to customer service was not helpful because they would only talk to her about getting access to her account online. They would, however, give me any information that was available online, just not let me go see for myself.
The next day, she called to reset the password. She spent 12 minutes answering questions about herself and just before she’d had enough, she was told to try to log on again and to remember the logon was case sensitive. That was it. She hung up and told me to try again, remembering that it’s case sensitive.
So I called customer service back. I complained about how backwards and antiquated this company is and how we have to jump through so many hoops for simple things that you take for granted with other card issuers. I was offered transaction information but nothing pertaining to gaining access to the online account.
My response was to get the balance if any, pay it off, and cancel the card. Unfortunately, I can’t pay off the balance with a credit card because they only accept one credit card payment every 14 days. And I was informed that they only accept one check payment every 10 days. The representative didn’t even sound sure when she told me the due date for the $3.95 balance. And oh yes, only my daughter can cancel the account, so she will have to call them back. Yeah, that’s the way it should be, but she’ll end up on another 15+ minute call just to cancel the stupid thing.
Avoid this company unless you like futility and frustration.