Americans are being Eaten Alive by Credit Card Companies

[Vinnie From Indy]

The big credit card companies are doing their part to drive many Americans into financial ruin. Since Congress passed a very weak credit card reform bill last year, credit card companies have been raising rates as fast as they can for the vast majority of cardholders regardless of their credit or payment history. Even in an economy when the prime rate is hovering around 3.5%, credit card companies are routinely raising rates on millions of Americans to 29.99%. This is having devastating effects on our economy. Congress is discussing moving up the date that the weak regulations contained in last years bill will go into effect, but that does nothing for the people that are being charged usurious rates at the whim of these companies. The mafia-like tactics of the credit card companies is causing many millions of Americans great distress and it is shameful that Congress does not introduce new, stronger legislation to keep these wolves at bay.




"Higher interest rate? Yep. Lower credit limit? That, too. New fees for late payments? Absolutely.

In the months since Congress clamped down on what it deemed as "unfair and deceptive" credit card practices, dozens of credit card companies have been busily hiking fees, rates and penalties in anticipation of stricter rules.

In the last few weeks alone, Bank of America tacked annual fees of $29 to $99 onto some cards and Citibank jumped some annual interest rates to nearly 30 percent.

Pablo Espinoza, a California state Assembly staffer, knows it too well. A Citibank customer for 11 years, Espinoza said he frequently got "preferred" treatment, such as the temporary 5.99 percent interest rate he was carrying. Not anymore.

A week ago, he got a Citibank letter informing him that his interest rate was going up way up to 29.99 percent."

http://www.chicagotribune.com/business/yourmoney/sns-200911021347mctnewsservbc-pfp-notebook-qa-sa34,0,1681957.story



"Although Congress has passed laws governing how card companies treat consumer credit, a new study shows that many card companies are still acting in ways that will soon be illegal.

According to the Pew Charitable Trusts, many practices considered "unfair or deceptive" by the Federal Reserve are still common at companies that issue credit cards. Of the 12 banks Pew examined, every one of them took part in the practices.

"None of these bank-issued cards would meet the requirements of the Credit CARD Act of 2009," Pew's report noted.

For example, 99.7 percent of credit cards gave issuers the option of raising rates on outstanding debts. Furthermore, 90 percent of the cards had penalty interest rates that are triggered by late payments or by purchases that exceed credit limits."

Read more: http://www.creditfyi.com/News/unfair-credit-card-practices-continue-456.htm#ixzz0WQAQlAVj

[MadHound]

1. The only way to bring CC companies under control is to cut up your cards

And drive them into bankruptcy. You can't expect meaningful reform out of Congress, so instead, stop doing business with them. Go to a cash/check only basis, not only will it screw the CC companies, but it will do your own personal finances a world of good.

[Vinnie From Indy]

7. Very true!

I do not think you can so lightly throw that many millions of Americans that are currently stuck with high balances under the bus however. We are talking about millions and millions of Americans that are being subjected to interest rates that would make any loan shark envious.

I certainly do agree that the long term way out of this mess is exactly as you explain and I will add that I don't think that the credit card companies are being very smart in regard to their long term success. I think many of the people currently blindsided by these drastic rate hikes will think twice about riding the credit train again.

[MadHound]

12. I'm not saying throw people under the bus,

I'm saying that they need to cut up their cards, pay off their balances as soon as they can, and then let the CC companies fester in their own shithole.

It would do individuals and this entire a world of good to come down off of this credit buzz that we've been on for the past twenty years.

[Vinnie From Indy]

13. I agree!

Cheers!

[Xicano]

10. Exactly.

I got rid of all my credit cards several years ago. I only use cash, check or debit card.

[CoffeeCat]

17. Tru dat!!

You play with snakes...you WILL get bit!

These companies are scrambling like mad. They are like cornered animals. That's scary, since they
are the arbiters of how much interest, penalties and fees they want to charge you. They own you if
you are carrying a balance.

You are so right...it's time to cut up those cards! This is not a good deal for us anymore. These
credit-card companies will only try to screw you and mess up your financial health.

This is not a game to these credit-card companies. They exist to take your money from you. And if
you let them, they will--and they will figure out new ways to get more money from you, too.

[proud2BlibKansan]

18. Amen

I got rid of mine 25 years ago and have definitely lived happily ever after.

[MadHound]

19. I made a decision long ago not to ever get a CC

It has presented a few short term difficulties in my life, though nothing that I couldn't work around. However the long term benefits far outweigh those minor inconveniences.

[buchols]

21. How will it do that?

In 5 years of owning a CC, I haven't paid them a cent: but I have received a ton in return (cash back, retail protection, all kinds of perks and bonuses). Cash can't even begin to compare.

[Trajan]

23. Wow .....

You may be the luckiest or smartest motherf*cker I have ever met ....

Tell us: How'd you do it ?

How did you manage to NOT pay them a cent, and receive 'a ton' in return ? ...

Tell us 'stoopid liberals' how to avoid paying the credit card bill and STILL make out like a bandit, like you did ...

[xchrom]

2. recommend

[QC]

3. What are you, some kind of millionaire Trotskyite?

Get with the program, dude--predator capitalism is the bomb.

:sarcasm:

[NRaleighLiberal]

4. Yup - got my letter today, my wife last week, from Shitty (er, citi).

Never missed a payment, never late, great credit rating, but we are now both at 29.99 (from 16.99) - but they probably hate me because I pay the entire balance off each month...so they can raise my rate, but they won't get a penny of interest from me. I also realize we are very fortunate, and find their practice repugnant. I am not sure there will be any credit card that does not go for the gouge in advance of the regulations....

[MissB]

16. My USAA credit card hasn't.

Neither has dh's credit union card. They don't make a penny of interest off us, but they haven't touched the rates in at least 18 months.

[dixiegrrrrl]

5. We just our Citibank lettter of raised rates.

Fortunately, we never carry a balance.
I expect a letter to come next stating they will charge a fee for the "privilege" of having their card.
At which time we will cut it up.

[bobbolink]

9. I hope you aren't one of those despicable people who would deny

the CEOs their huge bonuses.

:evilgrin:

[Ironman3476]

14. They call it an inactivity fee.

It's like entering into a contract to sell something for $10, and after being paid $10 telling the buyer the cost is now $20. Perhaps more,so hurry up and pay the $20 before it goes up.
I'm really in the wrong business.

[bbinacan]

6. It's simple.

Don't use credit cards and if you must, pay them off each month. If you can't (like I use to be), get a good non-profit debt management company. Fuck the CC companies. I only have an AMEX and haven't used it in over 2 years. I now use my debit card so that I know what I'm spending.

[Writer]

8. Question: Earlier this year, Citicards decided to raise our rates.

We refused to accept the new contract, so our rate stays the same until the card expires.

Can this credit card bill help our situation retroactively? Will Citicards be forced to maintain our card, or did our refusal to honor the contract preclude us from any further negotiation with them?

[defendandprotect]

11. We need to return to usury laws . . . once 6% . . .

Further we need what we give to banks to be treated as a loan to them . . .
with comparable costs to the banks as credit card charges --

Also, we need to put usury laws back on student loans -- used to be 6 years --
now infinite -- !!!

[quinnox]

15. they raised my rate too

23% from Capital One

Credit card bill did nothing to slow them down, they still get rich from people who need some quick money for every day things and have to rely on credit!

[wisteria]

20. The credit card companies will drive people away for using their cards.

Honestly, they have gotten so bad, I am waiting for them to start demanding that every credit card holder carry credit card protection insurance, in case minimums can not be paid because of job loss or illness. The card companies will be the losers in the end though, some people will lose their good credit standing because they can't pay the bill with the high interest rates and the high minimum payments. And, other people will pay off their bills and never use credit cards regularly ever again.

[customerserviceguy]

22. Finally paid off B of A

I used one of their zero interest rate loans to refi a higher interest card, I only ended up paying them interest for a relatively few months, used their money for nearly a year.

Other than revolving charges on my Amex (gives me free hotel points that I can use) I'm done with having positive balances on credit cards. And I plan on paying the Amex in full every month, so they won't get a dime off of me.

[havocmom]

24. Wonder how much American credit card debt is from medical costs

Double whammy from the corporations.