Borrowers get a card that unlocks the car and activates a device to start the ignition.
"Chase abused the judicial process and engaged in serious misconduct against California credit card borrowers, " Harris said in a statement.
From 2010 to 2011 there was a 4.7 percentage point increase in retail card originations to sub-prime borrowers, making up 31% of 2011 retail credit card originations, Equifax says.
FORBES: Subprime Lending Is Back, And That's Not Such A Bad Thing
The rationale is that borrowers will consolidate their credit card debt, where double- digit rates are the norm, into the new mortgage.
It has proved much more difficult for borrowers to switch their debt to another card for a better deal.
For borrowers, they pay less than credit card rates and for investors, they get better interest rates than CDs or bank savings accounts.
FORBES: Lending Club Raises $17.5M, Adds Mary Meeker To Board
And as the 1990s have seen ferocious competition between financial companies to lend to lower-tier borrowers, virtually anyone can get a credit card.
Some of the cards operate like payment plans where borrowers make a purchase from the retailer on the card and then have a number of months to pay it back, interest-free.
Meanwhile, card lenders have tightened standards, and new borrowers are less likely to get into trouble.
WSJ: Long-Term Unemployed Fall Out of Credit-Card Statistics
This month, mortgage rates for borrowers with good credit have spiked, and credit-card giant Capital One Financial jacked up interest rates, citing ...
LG, the credit-card issuer with the worst record for defaulting borrowers.
"Card companies are reluctant to lend to riskier borrowers just as anyone else might be reluctant to lend even to a brother or a sister if they don't think that that brother or sister can repay that loan, " she says.
The financial collapse of 2008 has had a long-lasting effect on credit card loans but conditions are slowly improving for both borrowers and lenders.
FORBES: Credit Card Delinquency Rate Falls for 17th Consecutive Month
The SEC says that should ensure that the firms will be more careful in screening the borrowers who take out the mortgages, car loans, and credit card debt that make up the packages.
Chris Van der Stad, president of New Millennium Bank, says the card offers a "good value" and a chance for borrowers to rehabilitate their credit ratings by paying on time and being responsible.
Three such cards have rates of nearly 30% for borrowers who fall behind on their payments, including the Marathon Platinum reward card and the Speedway SuperAmerica Platinum MasterCard, both issued by JPMorgan Chase, and the Citgo Preferred Visa, issued by Citigroup.
Card companies, burned by credit losses and sweeping credit-card legislation passed last year, have scaled back on credit lines, becoming more selective on borrowers.
WSJ: Long-Term Unemployed Fall Out of Credit-Card Statistics
Credit card issuers are stepping up their marketing efforts on health-care cards and lines of credit that help borrowers finance costly elective medical procedures.
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