Credit card company practices hit new low

Mine Jumped

from 9% to 19% because the market had changed.  At least according to Capital One.  Good thing tho that I transferred all that to a consolidation loan with a much lower apr.

"I would rather be exposed to the inconveniences attending too much liberty than to those attending too small a degree of it." -- Thomas Jefferson

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by: Daimeon @ Tue Dec 04, 2007 at 08:43:13 AM CST

Here's a Radical Idea...

...don't do business with them. These are, after all, voluntary private contracts among competent consenting adults.

Isn't "my outrage and disgust over it entitles me to prevent those who are not outraged and disgusted over it from doing it, despite the fact that I am in no way harmed by others doing it, apart from my outrage and disgust" the modus operandi of the anti-gay bigots? Why would you possibly want to borrow a page from their playbook?

Quite embarrassing worldview, IMHO.

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by: KipEsquire @ Tue Dec 04, 2007 at 09:38:05 AM CST

You may be missing the point, Kip

These are competent, consenting adults who entered into a contract only to see the terms radically changed, without warning, to the benefit of the other party. If you have a balance of more than a couple thousand dollars on a card that suddenly jumps to a 30% APR, it will probably be difficult to find another card to transfer that balance to.

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by: boltgirl @ Tue Dec 04, 2007 at 09:52:33 AM CST

Is it any wonder?

These same banks have been enjoying several years of record profits...why not make sure the trend continues?

I agree however, do your homework and as long as your credit score is in good standing, you should and CAN find a card with a lower interest rate and/or no annual fee.

http://www.cardtrak.com/cards

http://www.bankrate.com/brm/rate/cc_home.asp

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by: bkmn @ Tue Dec 04, 2007 at 09:56:32 AM CST

Oh, now congress is concerned

Where was that concern when they passed the law that led up to this?  And no, you can't blame it all on the Republican majority at the time either.  It was the votes of Democrats which allowed this happen.  Once again the rich get richer while the poor get poorer.  Screw them all.  Armed insurrection is starting to seem more and more a valid political strategy.

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by: Paul In SF @ Tue Dec 04, 2007 at 10:08:06 AM CST

The problem with armed insurrection is that...

...you trade new masters for the old.  I don't know if there's any system that'll offset our innate proclivities for greed and control.  Chrisitianity sure hasn't worked.  How many people who deplane in Vegas are alleged Christians?  How many people in McMansions are alleged Chrisitians?  How many people who buy lottery tickets are alleged Christians? 

Wanting more and more is the font of perpetual misery.

And what we really need is to just connect, but the things we buy and the programs we watch disconnect us.  Why visit with your neighbors we've got a home theater and you're watching movies that tell you the guy next door wants to torture you?

 

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by: Holly Capote @ Tue Dec 04, 2007 at 10:24:40 AM CST

[ Parent ]

Insurrection or class war?

I have to think that we're on our way to class warfare.  The more the middle class gets squeezed, perhaps the more likely it is that we don't have an armed insurrecetion so much as a shutting down of the economy by people who are fed up with CEOs making 400 times the average worker's pay.

Of course, that would require people to get off their lazy asses and do something.

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by: SuburbanHomo @ Tue Dec 04, 2007 at 10:49:06 AM CST

[ Parent ]

Aw, I wish I had read this before posting

Don't taze arrest me, Bro!

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by: Paul In SF @ Tue Dec 04, 2007 at 20:08:47 PM CST

[ Parent ]

This might be due to desperation.

Due to the growing subprime mortgage hurricane, many banks will collapse.   They loaned money to bad borrowers and they might be now trying to loan money in bad faith to offset their losses.  The federal gov't won't be able to save them: it's borrowed too much money already.  I keep reiterating that the sky will be falling.  When banks collapse, it'll be depression.  If you owe money, pay it off.  If you have assets, like a house, don't borrow more money.  I had very bad credit a few years ago: I couldn't even pay my bills and had to talk to creditors every couple months on the phone.  As my credit has improved (it's 837 out of 850) and there's all sorts of interesting bennies, like my insurance going down every year: it's now $500 a year for 2 cars.  And my Mastercard card rate is 9.2%, but I only hold it for emergencies.  It's handy being able to borrow money without forms and waiting for an approval.  It's also dangerous. 

Enter the coming depression with bad credit and you'll "owe your soul to the company store."

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by: Holly Capote @ Tue Dec 04, 2007 at 10:19:17 AM CST

Bad Credit..

Hey Holly. Just wondering if you could pass on some of your wisdom about getting out of bad credit. I made some stupid mistakes when I was 21 that I'm still paying for, and really don't know where to start cleaning up the mess. It seems like most agencies that help with that sort of thing just want loads of money from me, and if I did have money, I probably wouldn't have the credit issues in the first place. sigh

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by: Rick @ Tue Dec 04, 2007 at 12:26:26 PM CST

[ Parent ]

I've always suspected that those agencies that "help"...

...folks just want to be another leech attached to a person's life.  My advice:

Live simply. 

More specifically: 

You can buy much food if it isn't processed.  Buy raw food and make your meals.

If you can use public transportation or ride you bike, then do...and sell your car.

Never buy new.  Used clothes are just fine.  So are used cars and appliances.

Pay off the high interest stuff first.  I have a student loan that's pure balance: no interest.  I could pay it off, but I don't.

Talk to folks.  No company wants default.  Call them.  Be polite.  If you're not getting anywhere, politely ask to speak to their supervisor.  Human beings decide what happens to you: not the company.  The company might have policies, but human beings decide to apply them or ignore them and being nice might put them on your side.

Work hard.  Work long hours.  Work a second job.  I wrote an article until 2 a.m. Sunday night and performed all day yesterday, so I'm not advising something that I don't do. 

Get a roomie if you don't have one.

If you're young, invest, invest, invest.  My invested money makes much more money that I do...and I don't spend a dime of it.  The earnings just make that much  more money.  It takes only $10,000 in the stock market when you're 17 to be a millionaire at 65.  Deposit $2,000 in the stock market every year of your life and you'll be worth over 30 million when you're 65. 

BUT if you have some money in market now, get most of it out.  A huge drop is coming and probably within the next year or two.  Bush has borrowed too much money and taxed too little and the dollar is worth less everyday and our international credit is plummeting.

You can go from bad credit to good credit and when you do, life becomes cheaper.  My insurance company has dropped my rate 10 or so times.  My credit card has done the same.  I'm forever getting 0% balance transfer offers, but I throw them away.  They're trying to coax me into debt and I got out of debt by living the simple life, not by borrowing more money. 

I just bought a newish car, but I was driving a two-tone, rusty, creaky car.  Few people drive a car like that anymore, but it sure saved me mucho money over the past-plus decade.  And all my clothing comes from Goodwill.  And so on.

It was brave of you to ask.    

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by: Holly Capote @ Tue Dec 04, 2007 at 12:42:29 PM CST

[ Parent ]

Stock Market Collapse

Yeah, I'm worried about the stock market too. I'm thinking of putting a few thousand dollars into foreign markets. Maybe Canada, Japan, or Korea.

<3 Sam

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by: Samie D @ Tue Dec 04, 2007 at 14:38:27 PM CST

[ Parent ]

I'm in money markets and overseas, mostly, but mostly...

...money markets.   

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by: Holly Capote @ Tue Dec 04, 2007 at 15:42:35 PM CST

[ Parent ]

That explains things

I have a credit card that is completely paid off, that I had been paying over the minimum when it had a balance, and on which I had no late payments.

I called last month and told them to either lower my interest rate or cancel the card and they talked me into holding onto it while they "looked to see what they could do." That turned out to be absolutely nothing.

Bleech! I think I am going to call them up and tell them to put their credit card where the sun doesn't shine.  

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by: Zorya @ Tue Dec 04, 2007 at 10:48:19 AM CST

Congrats on paying it off!

Is it your only major credit card?  One only needs one, although some people feel powerful when they have a wallet full of plastic, which is weird, for the ability to borrow money isn't wealth.  And if one lives in a big house on borrowed money, that isn't wealth either.  Wealth is assets surpassing debts and half of middle class families don't even have assets that surpass debts.  In other words, they're worth nothing, regardless of appearances.  My assets are about 10 times my debts and over the course of my life, I haven't even earned much money and have given away hundreds of thousands, but I've also never owned a new car or bought a new major appliance.  Live with less and one will have more.  And I'm proud that I live a plain life: it takes so little to amuse me, since everything is relative.

And don't hesitate to cancel your credit card, Zorya, but be polite when you negotiate.  Always be polite.  It's powerful.

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by: Holly Capote @ Tue Dec 04, 2007 at 10:57:56 AM CST

[ Parent ]

The plain life

I hear you, Holly. Despite surviving on a subsistence income, I actually have a positive net worth, which probably makes me richer than the guy who just bought the $750k 2-bedroom house next door.

The plain life is great. Much less stressful, and you can still enjoy yourself. For example, why should I pay $30 to 50 per month for a cable TV hook up when the public library has thousands of commercial-free DVDs that I can borrow for free? (And any decent show eventually comes out on DVD anyway.)

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by: Stephanie, in Victoria @ Tue Dec 04, 2007 at 11:44:03 AM CST

[ Parent ]

Yes, Stephanie, and here's a big bennie of living small:

For some folks to feel alive, they have to sip a latte in Prague or parachute into a canyon in Borneo.  I get a kick out of seeing the dogs across the street or playing with the kids next door.  Because I live a simple life, I don't need cameras filming my "Simple Life" to make me feel alive, ala Paris and Nicole. 

Way to go, Stephanie.  Really.  I'm proud that you live in the black.

I just read an article where the author predicted a coming drop in real estate prices that could make real estate affordable for...folks with cash.  Folks with debt, like the $750,000 your next door neighbor bears, will, of course, be paddling upstream the rest of their lives.

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by: Holly Capote @ Tue Dec 04, 2007 at 12:23:34 PM CST

[ Parent ]

Of course, it's not always that easy

My family is carrying around 30k of debt, and while some of it may have to do with living beyond our means, the majority of it involves the erosion of the social safety net:

- My partner was laid off twice for periods totaling 18 months

- We recently had a daughter: maternity leave involved 6 weeks at 50% pay, and 2 weeks at no pay

 -Our insurance company is charging us $1500 in copayments for the birth

- I'm transsexual, and pretty much all of my legal bills or medical care comes straight out of my pocket (in the neighborhood of $6k to date, with [i]a bare minimum[/i] of $40-50k in the next few years. 

 

None of this is meant as whining about my particular situation, but as an example of how debt piles up.  There's plenty of situations where active government neglect of the economy and the needs of ordinary people contributes to the problem (say, the case of people who, due to inadequate public transit, need to get a car to get to work, but can't afford it, or people who don't have any health insurance at all.)

 

Obviously, there's a ton of responsible steps that we can all take to stay out of debt.  However, from my perspective, it seems pretty clear that the people who run this country want me to be in debt, and it's a real pain avoiding it. 

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by: eastsidekate @ Tue Dec 04, 2007 at 14:07:31 PM CST

[ Parent ]

Eastsidekate wrote:

"However, from my perspective, it seems pretty clear that the people who run this country want me to be in debt, and it's a real pain avoiding it."

Yep, they want us in debt.  They want us to be serfs and it can hurt to stay free.

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by: Holly Capote @ Tue Dec 04, 2007 at 14:36:34 PM CST

[ Parent ]

There are always debit cards...

...or even (shudder!) cash.

We stopped using credit cards several years ago.

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by: raj @ Tue Dec 04, 2007 at 16:51:54 PM CST

Another reason I have not paid interest in over 5 years!

After getting into minor financial problems, I decided after I recovered that I would do my best to  not pay credit card companies any interest.  I know the credit companies treat low credit people better because they figure they need the money, will keep balances and in essence be pilling up the debt with INTEREST for them.  I figured out the game, and thank goodness, I have been able to avoid paying any interest to them in the last 5 years.  12-19% interest?  I DON"T THINK SO!

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by: Juan @ Wed Dec 05, 2007 at 03:34:55 AM CST

Psst. Here's the secret.

(Pay off your entire balance each month.  Voila.  No finance charges.

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by: Clownley @ Wed Dec 05, 2007 at 12:16:08 PM CST