Have you seen the CashCall commercials with Gary Coleman, the little guy best known as Arnold on Different Strokes?  It promotes a fast cash loan service that is just a phone call away [click on pic to view]:

What is a loan from CashCall going to cost you?

*MOUSE PRINT:

Just in case you can’t read that, it says the interest rate is 99.25%. On their website, sample interest rates are 24.58%, 59.46%, up to 99.25% depending on your state of residence and other factors.

At 99.25%, a $2600 loan would require you to pay back $9,095 over three and half years. That’s three and half times what was borrowed.

Fortunately, CashCall appears not to be able to make loans for residents of Iowa, Massachusetts, Nevada, New Jersey, New York, West Virginia and Wisconsin. What are the regulators in the other 43 states thinking?

By now, everyone has seen the Chase Freedom credit card commercial with their catchy jingle promising “triple rewards where you spend the most”. You get three points or three percent back for the three categories you spend the most on each month. The categories where you earn triple automatically change each month based on your spending habits.

Here is a portion of their website ad for the card:

So, if you spend a lot one month on car repairs, buy a ton of stuff at warehouse and discount stores, and pay for airline tickets or a cruise on your card, at three percent cash back, you will make a lot of money that month, right?  Wrong on several counts.

*MOUSE PRINT: Three percent back only applies to certain categories of purchases, in fact, only 15 particular categories qualify, and that fact is virtually invisible in the disclaimer in their commercial. The categories are:

grocery stores (that are not affiliated with or departments of superstores, warehouse clubs or discount stores), gas & convenience stores, quick service payment/fast food restaurants, telecommunications, cable/satellite TV/Internet service providers, video rentals, department stores, dry cleaners, drugstores, movie theatres, local and suburban commuter passenger transportation (including ferries, bridges, tolls, parking garages, taxis/limos), pet supply stores and veterinary services, utilities, beauty shops (salons and spas), or gym/recreation memberships.

Car repairs, warehouse and discount stores, travel, and many other big ticket potential purchases are not included according to Chase’s terms and conditions.

Okay, so it is just their 15 categories that qualify for three percent back. Let’s say in a particular month you spent $400 at the grocery store; your gas, electric and water bills total $400; and you had to spend $1000 on prescription drugs for your ailing mother. That’s $1800, and should qualify for $54 back. Not bad. But not true.

*MOUSE PRINT:

There is no maximum amount of base rebates or base points that can be earned on net purchases. Maximum bonus rebate accumulation per billing cycle on net purchases is $12 in bonus rebates or 1,200 points monthly, which equates to $600 in net purchases.

Translation: Only the first $600 in purchases in your combined three categories earns three percent back. So on that $1800 hypothetical purchase, you will receive only $18 back on the first $600, and one percent on the rest.

Chase’s concept is a great one to automatically adjust your rewards to match your purchase habits. Too bad many of your most expensive purchases do not qualify for the three percent back at all, and other purchases only qualify for a maximum bonus of $12 a month.