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Credit Cards--The Good, The Bad, The Ugly

By Eric McGowan

Mortgage and Lending

October 02, 2008 05:06 AM

Thursday, October 2, 2008

Credit Cards--"The Good, The Bad, The Ugly"

Credit cards maybe about to become a better product for the average American consumer. Typically, if one paid even a day late guess what a consequential "rate hike" occurred. Also, should one carry a higher balance then "those good ole boy's" tended to jack our rates up even more while lowering the limits in the process. Credit card companies pushed for tighter bankruptcy regulations and made the new laws enacted in 2005 even harsher should one find themselves in the unfortunate position to need to file for bankruptcy protection.

Most consumers pay an average of 19.9% and even in excess of 29.9% for the privilege of carrying credit card debt. This is both a privilege and becomes a curse as the issuers increase the rates and lower the limits at whim.
As a measure to help consumers, and good news for us, the Credit Cardholders Bill of Rights will be considered by the Senate in January. This will not be a "cure all"; however it does allow for the following provisions:

"eliminating predatory lending practices like retroactively applying interest rate hikes to balances, and implementing new requirements such as a 45-day notice before raising interest rates."

This in turn, would hopefully allow the consumer, Joe Public, to act and possibly avoid the new rate being imposed.
http://www.smartmoney.com/

Posted by Eric McGowan at 8:57 AM Labels: Alalender, Central Alabama Mortgages, Credit Cards, Credit Scores, St. Clair County Mortgages, St. Clair County Real Estate, U.S. Dollar

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June Piper-Brandon

Coldwell Banker Realty - Baltimore, MD

Creating Generational Wealth Through Homeownership

and, one of the biggies is Capital One who don't report the limit only the balance and therefore always looks like you are at your max.

Oct 02, 2008 05:51 AM

Laurie Logan

Keller Williams Realty, Inc., Broker Associate - Madison, WI

South Central WI Real Estate

Hey Eric,

Thank you for the update - managing credit card debt is a universal challenge. Anything, government officials could do to help would be appreciated.

The bottom line, though, is that each of us, as individuals or couples, need to pay down our cards, live within our means. When our debts are down, the credit industry has less power to trample us.

Oct 02, 2008 02:20 PM

Richard Stabile

Re/Max Real Estate Limited - Oradell, NJ

Bergen County New Homes Builder Realtor

The past 10 years or more, the credit card company's have given too much credit. They have caused people to get in financial trouble by giving hugh amounts of credit. Many times, they will give a card, when people have many cards already with high balances.

This is poor banking.

Richard

Oct 04, 2008 01:14 AM

Eric McGowan

Moody, AL

June, Laurie, and Richard thanks for reading. It is hard to tell sometimes when people do pick up on these things. At least this seems to be like a "good reform".

Oct 07, 2008 02:56 PM