USA   |   UK   |   Australia   |   Canada

10 most unreadable credit card contracts analysis of major card issuers contracts finds best, worst


When it comes to readability, these credit card agreements are the worst, as measured by readability programs in a analysis. Readability Study finds major card issuers' contracts unreadable by most Americans
The agreements were analyzed using a mathematical formula that determines how many years of education readers need in order to understand the content. The formula is one used for years in literacy and textbook circles called the FOG Index, with FOG standing for Frequency of Gobbledygook. 

These contracts are thick with FOG. The 10 most unreadable contracts require a reading level starting at 16.8 years -- or most of the way into someone's first year of post-graduate education. Experts in readability say that contracts should require, at most, a ninth-grade reading level if they are to be widely understood. 

Almost all were credit unions, but to be fair, credit unions also occupied every one of the slots on the list of 10 most readable contracts.

Rank Contract issuer
Reading level (years)
Number of words
1. GTE Federal Credit Union 18.5 3,558
2. Langley Federal Credit Union 18 3,499
3. Eglin Federal Credit Union 17.8 2,735
4. CompassBank 17.5 10,163
5. First Financial Federal Credit Union of Maryland 17.3 8,675
6. CompassBank 17.2 9,086
7. Alabama Telco Credit Union 17.1 1,412
8. Sharonview Federal Credit Union 17.1 4,336
9. Teachers Federal Credit Union 17 2,600
10. Educators Credit Union 16.8 2,746
Source: analysis of the credit card agreements contained in a database maintained by the Federal Reserve. Under the Credit CARD Act of 2009, all U.S. credit card issuers with more than 10,000 credit card accounts must submit their agreements to Fed every quarter.

See related: MAIN STORY: Credit card agreements unreadable to 4 of 5 Americans10 most readable credit card agreements, 10 wordiest credit card agreements, Readability of credit card agreements from biggest 20 banksHow credit card agreements' readability compares to familiar documents, Quotable: What lawmakers, consumer activists, bankers say, 3 language experts try to make sense of a card agreement, Federal database of credit card agreements not user friendly, Video: Consumers try in vain to understand credit card agreements

Published: July 22, 2010

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

Three most recent Legal, regulatory, privacy issues stories:
  • 6 ways to thwart pickpockets – Cybercriminals and data breaches get all the headlines today, but don't forget low-tech, fast-fingered pickpockets are still out there, blending in the crowd, eager to snatch your wallet ...
  • U.S. Bank refunds $48 million for add-ons – The Consumer Financial Protection Bureau extended its crackdown on bank add-on products to U.S. Bank, which charged for credit protection products that consumers didn't always receive ...
  • Fed holds course toward rate hike in 2015 – The Federal Reserve indicated that it will keep interest rates at historic lows for the time being to support the job market, but higher rates are coming ...

Share This Story

Follow Us!

Credit Card Rate Report

Updated: 10-01-2014

National Average 15.07%
Low Interest 10.37%
Business 12.80%
Balance Transfer 12.82%
Student 13.24%
Cash Back 14.98%
Reward 15.05%
Airline 15.46%
Bad Credit 22.73%
Instant Approval 28.00%