Credit card company abuses - relief in sight?
jcc64 wrote: I for one am THRILLED about this. I cannot believe that credit card companies are currently allowed to raise your interest rates if you are 1 day late on a payment to a DIFFERENT company. Why is that even information they are entitled to know?!
How refreshing that the plight of the individual consumer is being considered above the insatiable greed of big business. Hooray for once.
http://news.yahoo.com/s/nm/20090423/bs_nm/...a_creditcards_5
boyohboyohboy replied: I can only give you perspective from what my dh does at citi bank
and he is allowed to look at credit reports that report every late payment or default, including house foreclosure, because they are a credit lending company, and dont want to lend money to people who show a pattern of not being able to pay it back.
in todays economy they have to be, want to be more careful about who they are lending too.
they dont raise interest or apr, due to credit reports..
but certainly they do decrease the amount of available credit.
credit can be decreased each month depending on your credit report, if your repayment history shows you are starting to have trouble, they want to protect themselves from a dead beat that is going to stiff them on a loan..
I think the thing he complains about the most is that so many people feel entitled to this money on their credit cards, and dont seem to remember that this credit card is a loan...not something they earned or money that was theirs..
boyohboyohboy replied: I just had one more thought of something that dh does tell me frequently.
before banks started people out with low APR's and then if they defaulted on the loan, then banks were able to increase their APR'S to try to recoup some of the money they were losing..
but now if credit cards are having their hands tied by government then they are not going to offer anyone low APR's, people are going to start out at 19%. also right now citi for example isnt giving anyone new credit lines without a greater then 700 FICO. something that wasnt done before..
its going to be harder and harder to get credit.
My2Beauties replied: Good for him. I had a credit card company raise my interest rate to almost 30% and I've never been late on that card or any other card for that matter...they did it just because they can. I closed my account and will never ever use them again for any of my banking needs. I paid on time every month more than the minimum payment. 
jcc64 replied: I am by no means defending irresponsible borrowing or loan defaults. But there is a vast difference between vetting who deserves to have a credit card in the first place versus giving, no, aggressively courting customers (how many trees were destroyed with the mountains of credit card offers that stuff our mailboxes?) and then punishing them for behaviors that have nothing to do with the credit card company. If I pay a dr bill a day late, what does that have to do with my Visa bill? If I am never, ever late with a payment to my credit card company, they have no justification for designating me as a risk to them. If the credit card company was so concerned about protecting its assets, it should have been more careful about issuing the cards in the first place. Just because they've willingly taken on risky customers doesn't mean my entire life should be fair game for their perusal, nor should I be subjected to unscrupulous business practices.
boyohboyohboy replied:
with citi they never use medical bills as a reason to not offer credit, but they use old student loans, house loans, or credit cards, to refuse to offer more money..
My understanding it that citi does not raise APR for defaults, but I know there are bad credit practices out there..
I also know that just like with anything thing else there are good and bad guys out there that can ruin it for everyone.
I am sick of the people that call and yell at dh for reducing available credit, refusing to offer more credit, when it shows they are defaulting on other loans..they certainly should have the right to look at a credit report..and most people dont read the credit card agreement but its all in there, what you agree too..when you accept the offer.
I think for the vast majority of people who are in hot water, looking for lower APR's and more increased credit are not handling their responsibilities well..filing bankruptcy and not being held responsible for loans they agreed to pay back.
people act like they have some sense of entitlement. again this is just vast majority of phone calls dh takes nightly..very irresponsible irrate people, who feel that this is their money, and citi owes them..and then again, that because they took TARP money, they should do what the consumer wants no matter how reckless, because its TAX PAYER MONEY...
its really a mess.
its really sad.
yes I do agree there are bad banks out there..but not all...
coasterqueen replied: The practice of using credit reports w/banks is no different than insurance companies using credit reports to increase or decrease premiums. It's controversial for sure - it helps some and doesn't help others.
I was not aware cc companies were doing exactly what you were saying Jeanne. Interesting.
MommyToAshley replied: I see both sides. But, I hate that the aspect of personal responsibility is always removed from these issues. A person may receive hundreds of mailings for credit cards, but that does not mean you have to fill it out, get a credit card or even use it to purchase items that you can't afford. It is a personal choice.
If a credit card company were to raise my rates, I would discontinue use of the card. As far as lowering the credit limit, I don't see how that can be deceptive. If a credit card company feels you are at risk, then they should have the right to limit the amount of credit they extend to you. We have credit cards for convenience and security reasons, but we pay our balance every month and don't ever pay a cent of interest. The credit card company actually lowers our interest rate and is always increasing our line of credit. Is it deceptive or are they enticing us to use it more, maybe? But, it is our choice not to use it.... personal responsibility.
As for reviewing payment history to other sources being a violation of privacy, you actually sign that you give the credit card companies the right to review and monitor your credit -- you know that long two-page form that you sign when you fill out the credit card application that no one ever reads. If you don't want them to review your credit history, don't sign the form and don't get a credit card.
Please don't take me wrong, I don't want to see anyone being taken advantage of. It's just like the housing crisis right now -- There are always those cases were people are at risk of losing their home to no fault of their own (such as being laid off work or a medical emergency), but you can't remove the aspect of personal responsibility for those who purchased homes that they couldn't possibly afford -- regardless if the lender gave them the money or not.
I am not defending deceptive practices, I am just saying that everyone seems to ignore the aspect of personal responsibility. We live in a society where people do not work and save for what they want, it is about personal gratification now. However, medical expenses are completely different, and medical crisis do happen, and medical expenses are quadruple what they should be.. which is why I think that is where the focus of the administration should be.
Boo&BugsMom replied: Here is something that aggrivates me. We use bill pay through our bank. We use to have a Discover card. I stress...USE TO. Our APR use to be really low, about 12%. We were late...by no fault of our own, a few days because the mail didn't arrive on time through our bill pay (Medevante didn't send it out on time), and they jacked the interest rate up to almost 30%.
Yes, it was late, but STILL...it wasn't our fault and they didn't care. They just wanted their higher interest rate. And by no means did they miss out on any of our money!  I understand making penalties for people who abuse the privledge, but the credit card companies do take advantage of hard working good people who faithfully make their payments every month and that I find it very wrong!
jakesmommy08 replied: wow i hate credit card companies...... I understand that its the persons responsibility to make sure there bills are paid blah blah blah.........I have a card from capital one..... the first credit card i ever had and have had it for 4 years now. I never ever made a late payment untill i left my ex a year ago....Im a single mom who makes about $600 a month. Times got REALLY tough....and it came down to what bill is more important and needs paid first....(gas bill for heat or cc?) So I obviously got behind....I still to this day am fight with this card. I had settled with them on this card for $600. I was to pay $200 every 2 weeks. I when the time came to make my second payment i had to use 2 bank accounts so they got 2- $100 payments. and then i made my 3rd payment. so my impression was ok good this card is DONE!!! Finally!! Well it turns out that because I made the 2 $100 payments, it voided the settlement!!!! WHAT A BUNCH OF CRUD!!! THEY GOT THERE MONEY! WHAT DIFFERENCE DID IT MAKE HOW THEY GOT IT! So now they want me to pay the balance of $500 thats left on the card.....its a huge mess. and it seriously makes me soooooooooo mad! I dont think they realize how hard it was to come up with that money to pay that off and how good it felt that it was paid for them to tell me no i still have a $500 balance on it now. I know $500 doesnt sound like a lot but untill youve been in my position and have had to survive on $600 a month.....MAN I CANT WAIT TO HAVE MY ACCOUNTING DEGREE!!!!
Calimama replied: This why I don't have credit cards. 
boyohboyohboy replied:
I am sorry, you had hit some hard times. I do know what its like to be a single mom. I also know what its like to have to chose what bill to pay, and what to let go.
But just as an example, how is it the credit cards fault that you fell on hard times and couldnt make the payments on a bill you owed. I feel if you take out the money you owe it, all, not just some settled amount. I agree that if the credit card company agreed to take less from you, even though you spent the whole amount then that was great.
but if you were not sure of the terms of your agreement, again how is that their fault?
I am by no means a credit card adovcate. I intend to teach my kids, if you dont have the cash you dont buy it. I wish my parents had taught me that hard hard lesson..I spent and owed, but got myself out..It was by no means easy.
I just keep hearing people talk about how they dont feel they should have to pay back money because of other circumstances that fell on them..I mean if someone owed you large amounts of money, if you owned a business, you would feel bad for them that they hit hard times, but you are owed that money, you need that money to lend to others to keep your own company going...
I totally feel it is a personal responsibility to pay it back..
I also had a capital one credit card, I also received the notice that said from now on their APR was going up, I think it was like 28%..well we had a balance on the card, so we were offered the option of paying the money we owed back at our original agreed upon APR, and then closing the card, or allowing the new APR to take place....we closed the card. we were given the option. I am not sure why so many people feel this money is owed to them..at really low low APR?
there isnt going to be credit soon enough because of all the people that never pay it back..the people in good standing are going to suffer because of irresponsible people..
I am by no means saying this about YOU. I feel bad for you, and I truely do understand how it sucks to be in your shoes..but it helped me make a point that I have been thinking about.
stella6979 replied:
Same here.
jcc64 replied:
So you want to talk about personal responsibility and say, taxpayer owned Citibank's decision to purchase naming rights for the newly opened NY Mets baseball stadium, now called Citi Field for $500 million annually?? This company has no problem begging the gov't for money while simultaneously pi$$ing it out the window on pointless vanity advertising. So is this what you meant by personal responsibility?
Or is it spending $$$ on lavish corporate events, private jet travel, multi-million dollar office renovations (all of which appeared recently in the news) while taking gov't hand-outs? Isn't that kind of like buying filet mignon with food stamps? Or are corporations by their very nature not required to behave responsibly like the rest of us?
Btw, I personally have impeccable credit, lest you think this argument is self-serving. I pay my bills on time because I can. Not everyone is so lucky in the current climate. But, I guess they probably all deserved to get fired anyway.
MommyToAshley replied:
If you go back and read my posts about the bail-outs, you will see I was against all the bail-outs from the very beginning. I think I probably used the terms personal responsibility in those posts as well. I can dig them up if you can't find them. I agree the banks were irresponsible and should have been allowed to fail and those that had good practices would have probably bought out those banks and we wouldn't be in the mess we are in today. Here is a topic I started on that very topic: http://forums.parentingclub.com/index.php?...038&hl=bail-out
I wasn't trying to defend the banks, nor was I implying that you didn't pay your bills or would get any personal gain from this legislation. I was simply stating what I believe -- I was brought up to believe that you are responsible for your actions whether you are a corporation or a consumer. Period. And, that's how I plan to raise my daughter as well.
As far as people getting laid off or in special circumstances, I said in my original post that my comments about how they got there in the first place did not apply to them. But, I know people that are laid off work and doing the responsible thing -- they have called the lender and explained the situation and agreed to make a VERY low monthly balance until they get their job back -- like $20 month. They will resume their normal payment when their employment begins again. The creditors worked with them, their credit history will not be tarnished, and yet they are still being responsible for their debt and not defaulting on it.
I know we don't often agree on these types of things, and it certianly is not because I come from a wealthy background or am wealthy now. My Dad worked hard all his life, retired from the service, and retired from another job after that. But, that was barely enough to put food on the table. If we wanted extras, we had to earn the money by babysitting or getting a job -- and that included going to college. I certainly am not wealthy now. I live a modest lifestyle and give up the extras for what I think is important, like my daughter's education. So, it's not like I am some corporate fat-cat sitting in a high-rise looking down on everyone else. I simply believe you should be responsible for your actions, the money you borrow, the way you treat people, etc.
MommyToAshley replied:
I am sorry you have been through some rough times. I would call and keep calling the bank to get the situation straightened out. Do you have your agreement in writing and your canceled checks? I would pursue it.
And, I have to say that you should be very proud of yourself for taking matters into your own hands, working on your degree while being a single Mom. I admire you for that, and in the end, you will realize that all your efforts are worth it. Hang in there!
boyohboyohboy replied:
I am not talking about citi having personnal responsibility at all..I was giving an example from something we have experience in right now, thank God for the job.
I am stating my own opinion in personal responsibility.
I am not for or against citi, its my bread and butter right now..
but I am for one sick of all the crying about credit card debt when some people really got into bad circumstances at no fault of their own..there are people who never had a credit card and who paid on time, and had no debt and then because their company went belly up lost their jobs..and lost it all..maybe even their homes..those are the people I feel so bad for..
but not the ones who spent and spent beyond their means and then complain when they cant pay the big old mean credit cards back....or that their APR was raised..
or the ones who keep getting new cards and keep spending when they cant pay what they have now...on new tv's and cars, and clothes, and all the other stuff.
I by no means fault the people who truely are caught in the middle, caught in the tragedy that is now happening..but please give me a break with the whining about it and the blaming about it, some need to look in the mirror.
stella6979 replied:
I agree! Big kudos to you!!! 
redchief replied: It seems I can't even look at a post from Jeanne without worrying about my conservative roots.
Yes, people should be responsible for their debt. Yes, credit card companies should screen those seeking credit carefully. And yes, there are too many people who feel they are entitled to credit. The last is our society's fault. We brought up this generation of people who feel entitled and now we're paying for it.
For all of that, Jeanne is dead on! The credit card company's aren't solving any problems by jacking interest rates on people who are once late. They're tightening the noose around the necks of people who, arguably, have already wrapped the rope around their own throats. Our government (that means us little people whether the politicians care to admit it or not) has bailed out every one of the large credit card companies. EVERY ONE! The thanks the beleaguered little people get, often in their collective time of economic need, is a tripling of their interest rate because circumstances made their payment late. I say call in all of the government loans and let them all go belly up. For the reasons Jeanne stated and more, they don't deserve our aid.
For what it's worth I own a single credit card. I won't let them increase the available credit beyond $2,000.00. I don't want their loans. I got caught up in that too many years ago and worked myself out. I couldn't tell you what the interest rate on my card is because I refuse to keep a balance on the card. Funny how they keep offering me incentives to do the opposite. Corporate scum.
Boo&BugsMom replied:
Funny how you mention this. When Troy went to cancel/close our Discover card...the one who started charging us a 30% interest rate...they tried to get us to keep the card by giving us a 9% rate, or something really low. Gee...if that was possible WHY didn't you do that a long time ago??? That makes me furious! We still cancelled. That to me, is just ridiculous.
MommyToAshley replied: That's another thing most people don't know.... you can call your credit card company and ask them to lower your interest rate. Most of the time they will do so.
MommyToAshley replied:
I don't think it has anything to do with politics. (Obama talked about personal responsibility on his campaign trail.) I think these credit card companies need to act responsibly... we shouldn't have bailed them out. If people cancel their cards and leave when they hike their rates (as many on here already stated that they did), then they'll learn these tactics don't work. And, I think people need to take personal responsibility for their actions and their own debt. I don't see that as a conservative or liberal view... but more about personal and business eithics.
I am not saying that I have never had debt or that I have never bought things I wish I hadn't. But, I have learned from my mistakes and I didn't blame the credit card company for making me use the credit card or blame McDonald's because I ate a cheeseburger and gained a pound.
msoulz replied:
 And if we all did that the credit card companies/banks would not have the grip on society that they have and would not be "too big to fail".
luvmykids replied: Credit card companies are scum sucking predators imho. Those who deserve credit and use it responsibly, fine. But we all know credit card companies are in business for one reason....to get people to use their money in order to make money. I'm not by any means excusing those who are irresponsible, but I do think the bulk of the blame lies with these companies who got greedy and started extending it to people who weren't in any means qualified for it. They've been allowing high risk cards for years now....they're called high risk for a reason, and these companies chose to extend the credit anyway. Why? Because then they were justified charging an arm and a leg.
DH's grandmother has perfect credit. I mean PERFECT, has never been late on a payment in her 80+ years. Uses cards to earn air miles, etc and pays them off in full every single month. Just had all four companies jack her rates from 9% to 20+%. Why? Because she fits a "profile"....they didn't come out and say it, I'm sure because it could be considered discrimination, but what she got out of the conversation was basically because she is elderly and retired. Nevermind that she is, in spite of the economy, very well off. They cut their nose to spite their face...she doesn't need the credit so she cancelled all of them, they begged her back at lower than her original rates and she said no. Instead of being happy with the fact she was a good paying customer, they got greedy and lost her all together.
grapfruit replied: I'll be honest, I didn't read the entire thread. But I do know that the company I work for, their CC dept said they will not raise your interest rate unless you're late on THEIR payment. They said they would not penalize you for being late w/someone else....
Just some input. Also, just b/c I have to call them ALL the time. They DO try working w/the customers. Unless you completely ignore them, or you get that particular rude individual, they're not THAT bad. Plus if you come into the branch you deal w/a nice banker (hopefully) that will help if they can.
My2Beauties replied:
They wouldn't for me, I asked the girl why my interest rate was being raised and she said something of the effect that my card went overlimit once   I don't ever remember it being over the limit but it's since been paid down and I pay on time every single month and more than the minimum and she absolultely refused to lower my APR so I closed the account and let her know how unhappy I was with the service. They couldn't even prove to me when it was overlimit, I've went back online to all my statements, can't find it! I honestly think they raised it because they can. 
Edited for misspelling
jcc64 replied: My posts weren't directed at you, Dee Dee, or anyone here, unless you happen to be a corporate executive engaging in some of the obnoxious behavior I described previously. Yes, people should be responsible. Yes people should read the fine print. Yes, as a society we've all been living way beyond our means in the almighty consumer sweepstakes. I was never arguing in defense of people not being held accountable for their own debt. Never once did I suggest that. And I don't understand how a discussion of ridiculous, bait and switch, deceptive corporate practices veered off into a rant on personal responsibility. So the argument goes, for some here, that because some consumers behaved irresponsibly, corporations are entitled to soak the rest of us into perpetuity. Unless you are somehow benefiting from their practices, which I highly doubt for anyone here, I just don't know how you can defend them.
And about calling and negotiating a rate down--that's an insidious practice onto itself. The credit companies rely on the fact that the people most in need of relief are the ones least likely to know that's even an option. Who benefits-- the well read, the well educated, the ones who typically aren't in trouble in the first place. And the fact that they're willing to negotiate at all suggests complicity. They know their little games are on shaky legal ground--which is why Obama's coming after them in the first place.
And Ed, I know there's a little liberal inside you, just dying to get out and play! 
MommyToAshley replied: I completely understand what you are saying, and I probably should have worded my original post a bit better. I suppose I am just really nervous about the direction the country is headed with the bail-outs -- we basically have a nationalized banking system, we have gov't telling our car companies how to run their business right down to the firing of the CEO, and now the gov't is getting even more involved with the banks and credit card companies.
I certainly don't agree with any kind of switch and bait. I suppose I have been lucky that they have never tried that on us. But, if it did happen, I would close the account and they would lose the business. If everyone did that, the creditors would learn that they can't get away with it. People do have a choice and don't have to be victim to these practices. However, I am not sure I agree with any kind of regulation stating that they can't lower your credit limit though. I think these companies need to be able assess whether or not they feel you are a risk and set the credit limit accordingly.
I am not completely opposed to any kind of legislation, I just fear where it is leading, just as I was fearful with the bail-outs. That's why I spoke out about personal responsibility -- it's more than just not spending beyond your means. It is exercising your right and choice to pick and choose who you do business with. That's what free enterprise is all about... those companies with shady practices will be weeded out. I do think it is important to protect people from unethical business practices, but at the same time, I think we need to be careful about going too far.
jcc64 replied:
Yeah, but not everyone has the means to simply close the account. Some people, by necessity, run up balances on their credit cards that they are unable to pay off when the company suddenly decides to jack up interest rates to 30%. It may not be because they're out buying luxury cars and vacations but because they charged an urgently needed medical procedure, a car repair or pay for their gas and groceries trying to save their cash for rent/utilities. There have been many months after I was laid off where we had to do that. We've carried HUGE balances at various points, but we always had the luxury of paying them down twice yearly when dh got his bonuses. Now with the market in a nose dive, we've been told that there will be no bonuses this year. Do I expect the credit card company to care about my problems- absolutely not, business is business. But I'm simply trying to get you to see that many of the people getting soaked by these practices weren't behaving irresponsibly in the first place, and deserve some sort of protection from predatory lending practices. The free market has basically had free reign since the Reagan Era (yes, I blame Clinton too), and its unchecked, runaway greed has brought this country to its knees. We can't keep doing the same thing and expect different results, kwim? If trickle down economics was such a good idea, why is unemployment now at record highs? And if the car companies were doing such a good job running themselves, they wouldn't have had to hop in their private jets to grovel for handouts in front of Congress. If we're gonna give them millions of dollars, we should have a say in who's managing it and how. I'm aghast that the banks involved in the bailout aren't required to disclose what they're doing with that money. The schools that received the stimulus money had tons of strings attached about how it could be spent. Why not the banks? What's different about them?
People are inherently greedy--it's just human nature. We need to have safeguards for the good of the whole. This is simply what I'm arguing for. We're not going to suddenly turn into the Soviet Union because we're demanding some responsibility on the part of the companies we're supporting. It's our fault for letting them get "too big to fail" in the first place. Now we're all paying the price with our jobs.
MommyToAshley replied:
I don't think we should have given them millions of dollars.
I totally get what you are saying, but I think it needs to be entered into with caution. And, even with legislation, consumers still need to enter into any contract with caution and spend responsibly.
Cece00 replied: i cant stand cc companies, i think they can be so shady.
im so glad we just paid off our cc....hopefully to not be used again except in the case of an extreme emergency...
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