Every credit card I have has had the interest rate jacked up to near or above 20%.

[PassingFair]

I have a thousand dollar balance I carry on
ONE card, I pay the rest in full each month.

Most are store credit cards that earn "points"...

Are we seeing the END of affordable credit?

What the hell is going to happen to folks who
carry large balances? Bankruptcy will be the
ONLY way out....

and NO ONE is going to purchase big ticket
items and durable goods.

I feel like nails are being pounded into the
coffin lid of our economy.

:cry:

[KansDem]

1. I hear you!

I got rid of two credit cards last year. Now I have only one card and a couple of other cards to retail and home improvement stores. I've closed the one retail card and am hoping to close the home-improvement card soon. Both those cards upped my interest rate to 29.99%. I only have a few hundred dollars on them, though.

I'm hoping to get down to one credit card and one debit card by the end of next year. And I'm hoping to payoff the balance of the one credit card.

I'm going "debt-free!" :D

Hang in there! :hi:

[percussivemadness]

2. here`s the thing about credit cards, its like saving in reverse

i wouldn`t say nails are being pounded into the coffin lid of the economy, what is happening is a major sociological shift, where people save and buy items with money rather than buy items and then spend 10 times as much actually paying for them...

[Skink]

3. My lawyer asked me that...

How many of your cards have more than a 20 percent balance to which I said all of them.

[endless october]

4. 24 percent here. won't be using the card again if i can help it.

[PassingFair]

5. I'm sure as hell not charging anything for Xmas this year!

I continue to use my credit card for gas, but
I'd better pay the sucker off again, as I had
let it climb a bit lately....

[sinkingfeeling]

6. I would assume that people will purchase big ticket items in the same way they did before the 'easy'

credit card industry began. They will save for them.

[PassingFair]

7. 1939, here we come!

We are screwn.

Those that have large debt are in/will be in
bankruptcy...except for the REALLY big debtors
and the corporations, who will just use their
"too big to fail" debts as leverage.

All others will, even those with sterling
credit, will fail to stimulate the economy
at all.

[Vinnie From Indy]

8. This was the deal to get the "credit card reform" bill passed last year in Congress

The deal was that the credit card industry would not fight too hard to block legislation and Congress would pass an extremely weak bill that would only stop one or two of the dozen or so most outrageous practices of these companies. Congress also agreed to have the bill go into effect only after the credit card companies had enough time to stick it to the millions of Americans that were carrying balances with 29.99% interest rates. This is even more outrageous because the prime lending rate is hovering around 3.5% and credit card company customers are being jacked for 29.99%. It is a national shame and it is doing much to make the severity of the financial meltdown much greater.

The point here is that the credit card companies have been allowed to charge interest rates that would make any mafia loan shark seem tame by comparison and they KNOW that many millions of Americans are STUCK with large balances that could never be paid in full right away. In short, there are whole lot of Americans that are being squeezed by these companies and they have no place to go for any kind of relief.

[PassingFair]

9. Do you think they will offer lower enticement rates AFTER the new law...

goes into effect.

Is this just an attempt to lock in existing
debt at high rates?

[hadrons]

10. Mine will be jacked to 24% (and yet, I'm a "valued customer" by MasterCard

theives

[Art_from_Ark]

30. You are a "valued customer" because they think you will be paying 24%

The ones who pay their balance in full each time are the "less-than-valued" customers.

[OllieLotte]

11. Maybe it's a good thing.

Probably shouldn't be carrying a balance anyway. Everyone knows it. Sometimes you can't help it and I regognize that. Most people buy crap they they don't need and are paying for it for years. AT 20% plus interest, people have extra incentive to pay them off. Once people stop paying all that extra money into CC companies, they will discover that they are much better off.

[PassingFair]

12. I think it is a VERY bad thing ... right when credit is needed most.

As this thread discusses; it COULD have been
a "good thing" LONG TERM....

but the timing is disastrous for our current
crisis. The big picture looks horrible.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=114&topic_id=72012&mesg_id=72012

[endless october]

13. honestly, i'd rather see an economy based on salaries rather than credit.

credit is a cop out for underpaying employees.

they can pay workers crap and still reap the benefits, because those employees are using credit to buy their products even though they can't afford them.

in my opinion, we're better off when things cost a little more, we make those things here, and people buy those goods by making enough money.

the low wage / cheap stuff / "charge it" model seems to be a failure.

[PassingFair]

14. Problem is the salaries are LOW and getting LOWER.

This is going to SEVERELY curtail spending
just when it is needed most.

People like me (the MAJORITY of card holders)
who would have charged $1,000 or so for Xmas
and paid it off over 3 months are NOT going
to be putting that money into the economy
THIS year.

:cry:

[Statistical]

23. Then you will have an extra $1000 3 months from now.

So what will you do with it? If you spend it 3 months from now it will do just as much "stimulating" as if you spend $1000 you don't have today and then pay bank back over next 3 months.

The idea that somehow consumer credit is stimulative is utterly insane. It shows how adicted we (as a nation) are to credit that you even entertain the idea that your $1000 for xmas just disapears because Visa won't "let you" spend it. Will the $1000 burn up? Will it be vaporized? Or will you still have it and thus be able to spend it (as real cash) in a couple months?

Easy credit is a plague that has helped to destroy middle class in America.
We sustained growth for 2 decades without wage increases because people felt richer by using all this "free" money.

[PassingFair]

28. Right, I should just spend the $1000 on the equity balance of my home....

that is losing HUGE CHUNKS its value
on a MONTHLY BASIS.

There is nothing wrong with revolving credit,
as long as you can keep it managed with small
balances.

I had to pay $400.00 for a veterinary bill last
month, instead of emptying out my checking account,
I put it on my charge card. Spreading the payments
out over time allows me to cover my regular expenses
without a worry.

At 30% APR, though, that's NOT the case.

[Xenotime]

29. 100% agree.

Companies are not giving bonuses this year. That means less money for the economy.

[Vinnie From Indy]

15. While what you offer is very true, you must understand something

There are MILLIONS of Americans right now that are stuck with high balances they could NEVER pay off immediately. The credit card companies know that and that is why they are jacking up rates so high.

While it is plainly obvious that folks should not have abused the easy credit of the last decade to dig themselves in a hole, it is also plainly obvious that we cannot simply write these MILLIONS of people off. Something needs to be done to stop these credit card companies from engaging in mafia-like loansharking on a grand scale. ALL Americans will be dragged down because of what these companies are doing. Add to that the suffering of so many families that are caught in this trap. Usury laws need to be re-examined.

[Warpy]

16. We're seeing the end of dirt cheap credit, and that's a good thing

18%-20% for unsecured consumer loans is just about right. Card holders have just gotten spoiled by years of ridiculously low teaser rates, bargain basement rates that encouraged them to go deeper in debt.

This will encourage everybody who can do so to pay the damned things off and keep them paid off--or get rid of them entirely.

[Art_from_Ark]

22. It's not a good thing for the people stuck in the credit crunch

who suddenly have to pay twice as much interest on the same loan

[roamer65]

17. Credit constriction is already at Great Depression levels.

This is just making it even worse. They borrow from the Fed at 0% and charge 20%+???? It's criminal and destroying the economy.

[roamer65]

18. ...and this credit constriction will be the source of the upcoming "double dip".

I was starting to pick up my spending a bit lately, but I have gotten these interest rate increases...so guess what...


I am shutting down spending completely again.

[PassingFair]

19. You and me both.

What about stuff like vet's bills that
CAN'T be paid in full?

This credit constriction will hurt everyone.

I am hoping that they will begin to have to
compete with each other soon after the new
laws go into effect....

[upi402]

20. Biden does their bidding

He voted to let them rape us. The nails are set and counter-sunk.

[notesdev]

21. There's a limit to how much debt can be sustained

on any given income, and as a nation we've hit that limit (and passed it by a fair margin, actually).

Right now there are few who both want to borrow and are creditworthy to borrow, and few lenders who are solvent enough to continue to make loans.

There's a quick way and a long way to solve the problem, .gov seems to have chosen the kick-the-can method, the very long way.

[mackerel]

24. Debt is how our economy grows.

Money as Debt

http://www.youtube.com/watch?v=vVkFb26u9g8

[jimlup]

25. But the F*@$& Banks can borrow money at 0.0 %

This is fucking unacceptable. OUR democratic majority needs to address this NOW

[barb162]

26. Mine have higher rates but it's not a bother

if you pay them off totally each month.

[mackerel]

27. But the banks don't want that...