I agree with you in theory but in practice I just don't see it. Many of these companies sign folks up for rates below 10% for a year and then just arbitrarily jack them up over time. They were able to exist at those rates initially... what's different now? I don't know how it is in your neck of the woods but around here For Sale signs and forclosure auctions are popping up like mushrooms after a rain. The only thing is , NOTHING is moving. And if you do sell you take a huge hit. And this cuts across all economic scales. If you want to stimulate the economy, instead of sending out these bogus rebate checks why not give people a fighting chance to pay off their debt without allowing them to incur more than they can handle going forward. The cost of carrying debt is crushing everyone from Chase to the little guy in a 2BR ranch.
Banks and the card companies offer those introductory rates or "teaser" rates in much the same way as the local grocer or businessman has offered promotional or sale pricing or other "limited time offers" or "loss leaders" for eons.....get the traffic in the door in the hope that they will stay and buy other goods with larger margins or enjoy the benefits of the product enough to continue using it well after the promotional period ends. George, I was in the banking business a long time and while we/they didn't always do things wisely, I can't recall a time when we/they did things arbitrarily.....if anything, as in most heavily regulated industries, paralysis by overanalysis was the greater competitive risk.
Times have changed for the worse in the credit card industry BT. These guys have figured out they can arbitrarily extort high interest from unsuspecting card holders and they do so at will with no repercussions from anyone. It is legal thievery and it's time the government steps in and sets the rules back to where they used to be.....fair and honest.
MCG, I do agree with you in principle but I also think it will probably result in credit cards being less available or unavailable to more people. I wonder how that will play from a political standpoint. Sort of like redlining, in actuality it helped control the risks for banks and mortagage companies. In reality it automatically eliminated a lot of minorities. Now it seems to me that evaluating risks is fair, and sometimes you have to face facts that certain areas of any city are higher risk. But politically it was untenable because it affected minorities more than whites. So the net is there are rules that prevent redlining (I think). Terry
Nonsense.....it's entirely your decision to use the product. It's entirely your decision to incur the debt and entirely your decision in terms of the provider you use. If the terms are not to your liking, don't use the product or change providers.....don't b!tch about the consequences of your own decisions when they were entirely at your discretion....if you don't like it, change the behaviors that led to the unfortunate circumstance. It's not somebody else's fault.....if you put your hand on a hot stove, don't b!tch about getting burned and don't ask for regulation to keep your hand safe.....move your freakin' hand. TOK, don't get me started on "redlining", rationing credit, etc. etc. , etc. What I will say and leave it at this, is that regulation has a played a material role in the credit issues we are facing........
You miss the point BT. People do use credit cards with terms that they initially agreed to that were much, much lower than default rates that are arbitrarily being applied today in a rampant fashion. The credit card issuers have changed the rules of the game after the game has mostly been played already. If you don't think that's wrong I am amazed. I have a personal example to share with you regarding Chase and I would never, ever give them the time of day again because of it. I had a Mastercard account with a bank out of the Carolinas a couple of years ago and when Chase bought them out they arbitrarily and with no provocation raised my rate on the card balance from 12.99% to 24.99%! I called Chase and was summarily told there was nothing they could do....it was new policy. I did not even hold the card with Chase and I certainly had no say when Chase entered the picture by buying out this bank. You think that's OK BT.....really?
I assure you it was not arbitrary. Chase acquired the company and raised prices....bfd. What do you do in other instances where one of your service providers raises their prices beyond what you think is reasonable? Ask for government intervention? NO, you find another provider....dude, take your debt and walk. Transfer your balances to another provider or pay it off. You are not helpless and you do not require government assistance. There are dozens of other providers and the terms and rates vary widely....if there is material account attrition from their pricing policy, trust me, the Chase boys - now Morgan boys, will be quite hesitant to be as aggressive next time out.
I did pay Chase immediately and closed the card and would never deal with them again. There may be other providers out there but with that kind of activity becoming commonplace the credit card industry is running amok and the American consumer is paying a high price for it. A lot of Americans do not have the means to pay off a card like I did and they get stuck with these exorbitant, undeserved rates. It is not realistic to expect that all people will not get themselves extended and become vulnerable to this predatory pricing. It's out of touch with the common man....elitist and cold-hearted to think otherwise......hmmm...sounds like a political party I know.
I was with you MCG. But you lost me with that last line which was intoned with a schoolgirl kind of squeal. It is also a hilariously inaccurate characterization. :lol:
Sorry about that George....but that seems to be BT's attitude about this. It's hard for me also to understand why it is that McCain chooses not address the problem with no stratgey to fix it as if he thinks it's OK what the credit card companies are doing. I couldn't vote for him with that kind of attitude.....even if it was Michael Dukakis on the other ticket. ( Wouldn't vote at all in that case ) That is how strongly I feel about this issue.
Actually a lot of americans get offers everyday in their mailbox to Move their balance to a new credit card with lower rates, they are even "pre-approved". If you are carrying a balance a lot of people move that balence around to the new card with low interest for 6 months or a year and then move it again when the "normal" rate is imposed. There is a website someplace that keeps up with all the rates, the offers etc with regards to credit cards. However be aware that closing and opening credit cards affects your credit score. Terry
What absolute freakin' tripe that is.....the "common man" will all get over extended and become vulnerable to a businessman who chose to raise his prices with the common man having absolutely no alternative to better his circumstance than whine for government intervention? I got news for ya....the common man don't carry a credit card balance! The common man manages his lifestyle in a prudent manner and doesn't require a credit card to fund expenditures that are in excess of his means. Fewer than 1/2 of all US households carry a balance and of the lower income brackets less than 1/3....the average balance on a credit card for the lower 20% of income earners in the US is less than $1,000 according to the most recent data. It ain't rocket science, if a businessman raises his prices and you don't like it, find a better alternative. If as a result of your own reckless behavior you have created a situation wherein you have no other alternatives, explain to me why I should bear some responsibilty for that problem? The user has a responsibility to engage in prudent, responsible behavior in the use of any product. If he chooses not to do so, should he not bear that burden? Hmmmm, let's see politically we have , "elitist and cold hearted" -v- whiny a$$es refusing to accept responsibility for their own actions, not be accountable for improving their personal situation whilst calling foul and seeking government assistance to ensure the rest of our society bears the burden and subsidizes their existence so as to ensure their continued stupidity into perpetuity. Give me "elitist and cold hearted" everytime.
American Express is designed by it's nature to carry no balance. Other cards like Mastercard and Visa lure customers by the promise of low rates etc. so they can carry a balance with a good deal on the interest rate. The consumer in this deal is being caught unaware that the card company plans to jack up his rate astronomically for little or no reason and trust me......this is never part of the advertising. It's dishonest and it's unprecedented in it's present form until the last 2-3 years or so. It is not some old established way of doing business that all consumers should have been aware of all along. Like someone said.....it is loansharking at it's purest form except I believe mobster loansharks advertise up front that the rate of interest is highly undesirable whereas these bastards lure in their victims with that low rate promise and then proceed to rob them later. But you go ahead BT and back this type of thievery as legitimate business. I'm appalled at such a stance.
Wonder if these card companies will try to hang on hoping McCain gets elected..... http://money.cnn.com/2008/04/17/news/economy/credit_cards_hearing/index.htm?cnn=yes
delusional nonsense.....the notion that everyone is forced to use cards, forced to not pay it off monthly, forced to carry a balance and forced to stick with their existing deal after the provider chooses - as is his right - to raise prices and unable to change providers - as is the consumers right - is sheer fantasyland. The consumer has absolute total discretion in each of those decision elements. Why is it always somebody else's fault with you? everybody is not a victim and there are other options available to consumers besides more government assistance. Credit card rates are high because they are an expensive product to provide. If you don't allow the high rates, you will lose the convenience of credit cards. If you impose regulation that would assist a very, very few individuals the unintended consequence is that you'll end up hurting more than you help by rationing credit and limiting its availabilty. If you can't afford to pay credit card rates don't use the product.....manage your affairs within your own means and in a manner that does not require you to borrow someone else's money to pay for your expenditures. If you are telling me that every provider lures in unsuspecting customers then arbitrarily jacks up rates in an effort to leave them no option and steal their last nickel is pure unadulterated fantasy.....here's a good one for you.....I would submit to you that the average rate paid on credit cards today has declined from historical levels and is lower today than it was during last democratic administration. What is actually taking place in the real world in the aggregate is often much, much different than the anecdotal snippets you portray or what a friend of yours told you happened to them.... I don't know about you, but this is not what I want my President spending his very limited time thinking about....surely there are more important issues to be addressed by our federal government.....
As Terry says switching card companies frequently to lower balances will lower your credit rating and get you in even more trouble because that's what they are looking for.....a chance to default your rate to high levels because of changes in your credit rating. It's a nasty game and they win. Then there is the case of one card company that offered me a low balance to transfer a balance and though I paid religiously on time they somehow raised my rate from 5.99% to 14.99% without any provocation or explanation. So I did transfer because of a deal that was offered and accepted and then they reneged. You must be one rough guy to do business with if that kind of crap is OK with you. If you were a contractor I see you as bidding a job....completing only half of it and collecting for that half and then threatening not to finish the job unless you were paid up front an amount 50% higher than you originally bid. Nice guy.....
You cannot be serious......they did not renege on anything. You just didn't read the agreement into which you entered. No doubt you threw it in the trash because you like the rest of us get inundated with mail in which you find any number of federally required disclosures thrust upon you by your friendly federal regulator. In that agreement, which is a federally required disclosure, you agreed to give them the right - after a time - to change their pricing at their discretion, subject to advance notice from them to you, which is another federally required disclosure. If you did not enter into such an agreement, and if they did not provide such disclosure, I can think of countless attorneys that will take your case for % of what would likely be a meaningful settlement. Renege my a$$......dude, you just need to take responsibility for your actions and deal with the consequences rather than whining about your misfortune like an old woman or child seeking redress for your imaginery grievances. They gave you a teaser rate as a promotion to attract your business, subsidizing you below their cost, to help ease the interest burden for a time that you incurred upon yourself, with the hope that after the promotional period was over, that you would choose to avail yourself of another of their product array or elect to continue business with them for any reason of your choosing at your sole discretion. If you choose to walk - as is your right - at the end of the promotional period, they have lost money on you..... I don't think your contractor would give you that kind of a deal but feel free to ask next time you have need of one and if you do find one, please send him my way. I'm done with this nonsense, but I do look forward to a further articulation of Marxist dogma.... Renege? Nice guy? WTF?
I understood it to be a permanent rate as it was described. I have another card balance transfer that was promised that way and has been just that with no changes. I don't need your admonishments. You don't know my situation and I don't know yours. But let me say this.....I am certain a very small minority of Americans would agree with your opinion that it is just fine for credit card issuers to employ the high interest default tactics that they have been rolling out in the last few years and most of those in agreement are probably in the banking industry. I will leave you with these stats: Total US consumer revolving debt reached $904 Billion in June 2007, up from $879 billion at the end of 2006 (Source: Federal Reserve) • The median U.S. household income is currently $43,200 and the typical family's credit card balance is now almost 5 percent of their annual income. (Source: Federal Reserve) • Of the households that do owe money on credit cards, the median balance was $2,200 -- meaning half owe more, half less. (Source: MSN Money) • 8.3 percent of households owe $9,000 or more on their cards (Source: MSN Money) • Approximately 40 percent of credit card users paid their balance in full each month in 2006 (Source: Federal Reserve Bank of Philadelphia With the economy in the state that it has been and with the housing market collpase and loss of home equity nationwide I can assure you that the numbers described above have all gone up with regard to total debt and debt carried as a balance.
Well done on your part....I'm encouraged by your usage of facts. Keep looking at the facts and its only a matter of time before you switch parties. I hate to burst your bubble, but you're not leaving me with anything I don't already know. So what is your conclusion?
I have two Chase credit cards that I use heavily and pay off every month. One is their Freedom card and one their Business card. Neither charges an annual fee and I get 3% rebates on some items and 1% on everything else. They vary on the cards is the reason I use both of them. If I have a problem with them I will dump them. In the meantime 3% back on gasoline, groceries, meals out and 1 % off on most other items adds up in a hurry if I use it frequently. I just received a $50 check on one account and a $250 on another. I'm not in love with Chase, but until I can find another card that I can get five to six hundred dollars a year back for stuff I would buy anyway them I am going to use them as I am sure they would use me if I carried balances.