New Credit Card Legislation

[RLflutie7]

I don't mean to speak for the Chef, but what he's probably referring to is what always happens when companies are forced to take on costly changes; the company passes the cost on to the consumer. In the case of credit card companies, what is happening is you will now see the return of annual fees and the disappearance of points/miles/rebates programs and interest charges hitting as soon as you make a purchase.

 

For example, I don't pay a dime for my business credit card. I pay off the balance every month, so I don't pay interest charges, but I also rack up miles which I can then apply to cover the cost of a flight for a business trip. What I'm likely to now see is an annual fee and no miles. And this is happening because people who shouldn't have credit cards are getting protection while people who use them responsibly have to pick up the costs. What I will now do is increase my costs to my customers to account for these new charges. My customers will pass it on their customers and their customers will pass it on to you...the person who did nothing but pay your bills on time.

 

In fairness, the credit card companies shouldn't be giving cards to the folks who can't handle them, but to protect those people by making the responsible people pick up the costs is ridiculous. Most importantly, the current administration -- due to its utter lack of business experience -- simply doesn't know or refuses to understand that making companies pay money to meet government requests simply and always gets passed on to the consumer. The cap-and-trade program will prove to be the perfect example of this.

 

 

Your post is way off base.

 

You are assuming that credit cards companies have acted like a "stand up guy" in the recent past. I've had credit cards since 1984 and they don't function the way they used to.

 

I sent a credit card bill 15 days before it was due and they charged me $39.99 for a late fee. They got my check in time. They just held it and posted the payment 1 day after it was due, so they could charge me the $39.99. I didn't pay the next month's bill and they called me and said they'd remove the two $39.99 charges if I made a check by phone payment.

 

That would have never happened back in the 80s.

 

The credit card companies brought this on themselves. I doubt that you'll get annual fees on your credit card accounts because you'll go to another credit card and they know that. They'll simply attach larger annual fees to the deadbeat accounts. They'll require a cash deposit to get a credit card for deadbeats, just like the old days.

 

 

I understand what you're saying when it comes to a business taking a dump. They won't take a dump for someone else.

 

That's why electric cars will never work. Once electric cars reach a certain point, like 1 million sold, the oil producing nations will lower the price of gas to $1.00 a gallon. And people will go back to driving gas powered SUVs.

 

The oil producing countries are not going to take a dump for someone else. They'll keep lowering the price until they get the market back.

 

As far as credit cards are concerned, I've heard so many different things from different people.

 

I've heard horror stories about Capital One, but I've never had a problem with my Capital One accounts and I have two accounts and I've been late on both.

 

I have a credit card raise my interest rate to 29.9% and I was never late on that one and that happened this month.

[erynthered]

Your post is way off base.

 

You are assuming that credit cards companies have acted like a "stand up guy" in the recent past. I've had credit cards since 1984 and they don't function the way they used to.

 

I sent a credit card bill 15 days before it was due and they charged me $39.99 for a late fee. They got my check in time. They just held it and posted the payment 1 day after it was due, so they could charge me the $39.99. I didn't pay the next month's bill and they called me and said they'd remove the two $39.99 charges if I made a check by phone payment.

 

That would have never happened back in the 80s.

 

The credit card companies brought this on themselves. I doubt that you'll get annual fees on your credit card accounts because you'll go to another credit card and they know that. They'll simply attach larger annual fees to the deadbeat accounts. They'll require a cash deposit to get a credit card for deadbeats, just like the old days.

 

 

I understand what you're saying when it comes to a business taking a dump. They won't take a dump for someone else.

 

That's why electric cars will never work. Once electric cars reach a certain point, like 1 million sold, the oil producing nations will lower the price of gas to $1.00 a gallon. And people will go back to driving gas powered SUVs.

 

The oil producing countries are not going to take a dump for someone else. They'll keep lowering the price until they get the market back.

 

As far as credit cards are concerned, I've heard so many different things from different people.

 

I've heard horror stories about Capital One, but I've never had a problem with my Capital One accounts and I have two accounts and I've been late on both.

 

I have a credit card raise my interest rate to 29.9% and I was never late on that one and that happened this month.

 

strange. ...........

 

Its the credit card companies fault that their card holders are not responsible enough to handle their card? Did I get that right?

 

Is that what you're saying???

[RLflutie7]

strange. ...........

 

Its the credit card companies fault that their card holders are not responsible enough to handle their card? Did I get that right?

 

Is that what you're saying???

 

 

No you're getting it wrong, as usual.

 

It's not responsible for credit card companies to raise interest rates to a 30% rate on an account that was never late or never overlimit. It's called bait and switch. I guess you don't understand that concept.

 

Regardless, I have a standing offer from one of my credit card companies that if I pay $500 dollars on the card, they'll give me a $264 credit. I only owe $850. I don't get it. It's not late or anything. They also raised the interest rate to 26%.

[Booster4324]

strange. ...........

 

Its the credit card companies fault that their card holders are not responsible enough to handle their card? Did I get that right?

 

Is that what you're saying???

 

You have to be drunk, you usually post somewhat better than this. Go cookout or something...wait, order Pizza as that seems safer.

[erynthered]

No you're getting it wrong

 

First off, learn how to end your post.....and answer it accordingly.

 

Let me ask you the question, again, for the 300th time, don't you think that the CC companies will pass along these new Gov regulations to the end user?

 

I cant wait for your answer.....

[RLflutie7]

First off, learn how to end your post.....and answer it accordingly.

 

Let me ask you the question, again, for the 300th time, don't you think that the CC companies will pass along these new Gov regulations to the end user?

 

I cant wait for your answer.....

 

 

No they won't be able to because they've already proven that much of the income they've made from late fees and overlimit charges are unsustainable.

 

They won't be able to increase fees on all card holders because the best card holders will close their accounts. It's that simple.

 

It's like rising fuel costs and airlines. The airlines can't pass the extra fuel cost to consumers because it would kill their sales. They raise fares for a short while, but it always goes back down. If what you are saying is true, then airlines would be able to increase their fares to $1000 each way for a flight from LA to SF.

 

 

Moreover, you don't understand the credit card industry. Credit card companies found out in the 90s that giving cards to anyone with a pulse was very profitable, because there was only a 1-3% default rate. So cutting off new card holders is not going to happen, which is what you suggest.

 

You say, in a nut shell, that credit will dry up. That won't happen because it hurts profits too much. If anything, the opposite will happen. More credit will be issued at reasonable rates and repayment plans.

[erynthered]

More credit will be issued at reasonable rates and repayment plans.

 

 

Drunk again, eh? God you're a dumb sh--.

[RLflutie7]

Drunk again, eh? God you're a dumb sh--.

 

 

Plus more companies, similiar to MNBA, will be able to enter the market place. The most likely situation is that the deadbeats will hold more accounts with smaller credit lines, but more overall credit.

 

Wall Street will love that.

 

If you think I'm drunk . . . What's going to happen to the housing market? Here's a clue . . . People with bad credit with be able to get easy credit . . . because there is not enough buyers. It's a numbers game . . . figure it out.

[/dev/null]

the credit card legislation is Bullschitt.

 

Obama is paying for my mortgage. Why shouldn't he pay for my credit cards too

[Magox]

You say, in a nut shell, that credit will dry up. That won't happen because it hurts profits too much. If anything, the opposite will happen. More credit will be issued at reasonable rates and repayment plans.

You are way off base, I gaurantee you that credit will be restricted more because of this decision. Regardless, credit is shrinking, but this will do nothing to help it.

 

Ever here of Meredith Whitney? Why don't you google her name up and see how credible she is. FYI, she's been the best banking analyst over the last 3 years hands down, she's called it right, where the other goofballs have gotten it wrong.

 

Here's what she says:

 

And fourth, along with many important and necessary mandates regarding fairness to consumers, impending changes to Unfair and Deceptive Acts or Practices (UDAP) regulations risk the very real unintended consequence of cutting off vast amounts of credit to consumers. Specifically, the new UDAP provisions would restrict repricing of risk, which could in turn restrict the availability of credit. If a lender cannot reprice for changing risk on an unsecured loan, the lender simply will not make the loan. This proposal is set to be effective by mid-2010, but talk now is of accelerating its adoption date. Politicians and regulators need to seriously consider what unintended consequences could occur from the implementation of this proposal in current form. Short of the U.S. government becoming a direct credit-card lender, invariably credit will come out of the system.

 

http://online.wsj.com/article/SB123664459331878113.html

 

Why don't you read the entire article, maybe you will learn something.

[finknottle]

They won't be able to increase fees on all card holders because the best card holders will close their accounts. It's that simple.

 

How is it that if they raise their annual fees, people will close their accounts; but if they raise their rates or deliver unsatisfactory customer service, people are powerless?

[Booster4324]

How is it that if they raise their annual fees, people will close their accounts; but if they raise their rates or deliver unsatisfactory customer service, people are powerless?

 

Aren't you an accountant? Because the ones that pay off their debt every month have an option. Those who have a lot of credit card debt find their options more restricted.

[GG]

Aren't you an accountant? Because the ones that pay off their debt every month have an option. Those who have a lot of credit card debt find their options more restricted.

 

And under both scenarios you will curtail spending and prolong the much awaited recovery.

[Booster4324]

And under both scenarios you will curtail spending and prolong the much awaited recovery.

 

Is this bad for the recovery? Probably. Is it necessary? I am not sure. I do think deceptive practices are complete and utter BS. Hell, I deal with customers who can't understand why they get billed every month on the same day. So shifting it around and adding extra mysterious fees? In all likelihood, the legislation will hurt as it was crafted by the fine geniuses in Washington. I simply thought his post disingenuous.

 

So we're not going to give people a free pass, and we expect consumers to live within their means and pay what they owe.

 

This cracks me up.

[GG]

Is this bad for the recovery? Probably. Is it necessary? I am not sure. I do think deceptive practices are complete and utter BS. Hell, I deal with customers who can't understand why they get billed every month on the same day. So shifting it around and adding extra mysterious fees? In all likelihood, the legislation will hurt as it was crafted by the fine geniuses in Washington. I simply thought his post disingenuous.

 

Can't disagree with that. CCs were a golden goose and banks got very fat off that hog that they took their eyes off the backlash that was building up. Legislation usually overcorrects actions beyond what is reasonably necessary. So again, both sides are to blame, and the end result will be a bad outcome for both sides.

[RLflutie7]

How is it that if they raise their annual fees, people will close their accounts; but if they raise their rates or deliver unsatisfactory customer service, people are powerless?

 

 

Read the posts.

 

The discussion centered on those people who pay off their credit cards and have no annual fees. Those credit card users don't get as many late fees or unfair overlimit charges.

 

My mom got tagged with late fees and overlimit chargers (she always has a credit card balance in the thousands, but she always pays and has great credit) and she switched cards and closed four accounts because she was charged and she wasn't late.

 

It's those people who don't have good credit that are getting ripped off more often. In the old days consumers had a five day grace. That doesn't happen any longer.

[RLflutie7]

You are way off base, I gaurantee you that credit will be restricted more because of this decision. Regardless, credit is shrinking, but this will do nothing to help it.

 

Ever here of Meredith Whitney? Why don't you google her name up and see how credible she is. FYI, she's been the best banking analyst over the last 3 years hands down, she's called it right, where the other goofballs have gotten it wrong.

 

Here's what she says:

 

And fourth, along with many important and necessary mandates regarding fairness to consumers, impending changes to Unfair and Deceptive Acts or Practices (UDAP) regulations risk the very real unintended consequence of cutting off vast amounts of credit to consumers. Specifically, the new UDAP provisions would restrict repricing of risk, which could in turn restrict the availability of credit. If a lender cannot reprice for changing risk on an unsecured loan, the lender simply will not make the loan. This proposal is set to be effective by mid-2010, but talk now is of accelerating its adoption date. Politicians and regulators need to seriously consider what unintended consequences could occur from the implementation of this proposal in current form. Short of the U.S. government becoming a direct credit-card lender, invariably credit will come out of the system.

 

http://online.wsj.com/article/SB123664459331878113.html

 

Why don't you read the entire article, maybe you will learn something.

 

 

As the article noted, credit is already drying up. This is already happening.

 

It's happened to me, like I said. I was offered a $264 credit if I paid $500 on an $850 balance.

 

I love Meredith Whitney and I agree with most of what she has to say. I watch CNBC all the time and I've seen her interviews. She's right when she said that proper lending standards were not used. But she's wrong if she thinks this law will make credit less available.

 

Companies that issue credit will still make unsecured loans regardless of their ability to reprice risk. They'll do it because others in the same industry will do it and when one does it, the dominos will start to fall and all others will do it.

[outsidethebox]

...like maybe, bye bye frequent flier miles? Maybe, start of annual fees again? Maybe start charging interest immediately at the time of the purchase? etc...etc...

 

 

Naaa, they wont do that!!

Does anyone believe all these "reward points" and frequent flier miles are really free? Someone has to pay for this. Maybe they should get rid of these perks?

[K-9]

Anyone remember the Congressman from a few years back who said that it's un-American for people to pay their credit card balances in full each month? I laughed my ass off when I heard that on CSPAN radio.

 

This is BS legislation. Not because it favors deadbeats over responsible payers. Not because they attached the gun law rider. It's BS because we let these companies get away with usury and this legislation does nothing to stop that. Yeah, I know it's a 'states' issue but usury is usury plain and simple. Or should I assume that these CC companies setting up shop in states that don't have usury laws simply coincidence?

 

Yea, South Dakota!

[blzrul]

Why use a debit card if you can get points/miles/cash back on a credit card? I mean, you're paying it off every month any way.

Sounds like someone likes his entitlements, eh?

 

I ended up donating those miles and cashback points anyway. I am not the kind of person a credit card company wants because I do pay on time.

 

Debit works for me just fine. I don't need handouts from credit card companies. As was pointed out earlier, they're not free anyway. Someone pays for them - probably the poor slob who's charging groceries for his kids and paying a 25% interest rate.