Consumer Comeback Blog

Clear As Mud: Who Has the Clearest Credit Application?

It seems like every product and service – from social media to pharmaceuticals – has a lengthy list of service terms, disclosures and exclusions that increasingly busy consumers rarely read. Heck, the character-saving, abbreviation-happy texting generation even made up a term to describe when something is that was too long to read TLDR (too long; didn’t read).

But not understanding your credit card application terms
can land you into financial hot water. CreditHub rated the top ten credit card issuers based on their transparency and the general comprehension of their service terms.

Each card was judged based on how easily key information could be understood and the location and visibility of that key information. Important components included clarity of introductory and regular APRs, balance transfer fees, annual fees, how a customer earns rewards, and how valuable their points and miles are for rewards credit cards.

The 2012 Top 10 easily discernible credit card applications:

  1. Capital One
  2. Citi
  3. U.S. Bank
  4. Discover
  5. Bank of America
  6. Wells Fargo
  7. Chase
  8. American Express
  9. USAA
  10. Barclays

The findings included:

  • Capital One has the clearest credit card applications for the third straight year, receiving an average score of 98.6% in 2012.
  • The worst performing issuers were USAA and Barclays, with average scores of 72.7% and 62.0%, respectively.
  • There was decline in overall transparency over the past year, with the average score falling from 89.0% in 2011 to 84.2% in 2012.
  • Citi’s credit card applications showed the most improvement from last year – its average score rose 14.3 percentage points, and USAA saw the biggest decline – its average score fell 12.3 percentage points.
  • Information related to rewards redemption and information on the balance transfer fee continue to be the most ambiguous across the board.
  • Most applications were very clear about the annual fee, how to earn rewards, and information on the purchase APR.
  • The study found that most credit card applications still use often confusing language such as ‘up to’ and ‘as low as’, although this has diminished considerably since 2010.

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