New Credit Card Rules
| Fri Dec. 19, 2008 8:08 AM PST
NEW CREDIT CARD RULES....New regulations designed to stop some of the most egregious credit card abuses were adopted yesterday. That's the good news. Here's the not-so-good news:
The regulations, which take effect in July 2010, would block card companies from applying higher interest rates on existing balances. Late fees could not be charged without giving consumers at least 21 days to make a payment.
You know, some regulatory changes need a substantial amount of lead time because they're fairly complex to implement. These aren't those kind. They don't require 18 months of preparation. They barely require one month of preparation. They could have taken effect January 1st if regulators had been inclined to make a statement. Another opportunity missed.
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Comments
In a similar vein I want to put out this warning. Most people know this already, but many people still do not, and a recent event in my family has again made this clear to me.
eBay and it's companion PayPal make the buyer vulnerable to fraud with absolutely NO recourse after the fraud occurs.
Sure there is a procedure but the end results in a form letter from PayPal stating in essence "Thank you. You followed our procedure to the letter and we agree that you were the victim of fraud. You won't get your money back, and because we instructed you to return the merchandise at your expense and you did that you no longer have your merchandise either. Read your ToS sucker. We hope this shows you that you can have complete trust in PayPal. Thanks and have a nice day."
PayPal, you want to come after me for libel? Please do. I have the truth on my side and you know it.
...least 21 days to make a payment.
One trick I've seen lately is that the time between the statement date and the time the statement appears in the mail is now approximately 8 days (Chase) for a VISA statement. (No postmarks of any kind on the envelope, naturally.)
There have been a couple of times this last year for me where the time between receipt of the statement and the due date (not postmarked, due at the processor) was less than two weeks. This means a weekend without paying bills can result in a late payment penalty or a pay-by-phone with a $10 fee.
The credit card companies are deluding themselves if they think they can protect these practices, and other more egregious practices, with lobbying and campaign contributions. Voters have very little good will or even indifference left towards the credit card companies, and an increasing amount of antipathy.
For whatever it's worth, letters and phone calls to your congressperson and senators are probably useful. (I rant to them in quick emails when I notice a new (or old) credit card company trick.)
Only in the United States could the Fed's action against credit card companies (taking effect in 18 months!) be considered true consumer protection. . . In most other countries these companies would be arrested for usuary. . . The Financial industry owns our political process - how much more proof do we really need?
slanted tom,
Time for some regime change.
No. I wish, but no. Hate is only the first step in a long downward process. Even in our twenty-first century everything-happens-faster condition we are not even close to the revolution that will be required for a regime change.
We will need to see our own starving children before we are desperate enough for action.
Wisconsin Reader,
The Financial industry owns our political process - how much more proof do we really need?
We need no more proof. Shoot, the "how high, what color?" response our government made to Wall street was proof enough.
Proof is the easy part. The hard part is doing something about it.
Essentially the uber-rich and their financial industry are saying "Yeah, so what can you do besides whine on the internet? Are you gonna cry to Mommy? Shut up losers."
I've been watching the results of the GOP convention in Saint Paul this year. From what I can see the compromise was torches and pitchforks in approved zones only, with about five times more people arrested and detained than there were people breaking any law, even some that might be unconstitutional. Then, quietly, after the fact, about 80% of the charges are being thrown out for lack of evidence.
Tripp: Essentially the uber-rich and their financial industry are saying "Yeah, so what can you do besides whine on the internet? Are you gonna cry to Mommy? Shut up losers."
Sigh. Once upon a time we dealt with such problems using a process called "elections" (since you're old enough to have college aged kids you may have a dim recollection of them, but I doubt your children do).
Of course that was before a very smart business decision was made: buy both parties!
Our comrades in the People's Republic of Arizona have made serious headway in changing this with publicly financed campaigns, but it's not clear if political consciousness is sufficiently developed in the other soviets. Makes me wish for a third arm - then I could carry a club along with my torch and pitchfork, and use it to knock sense into anyone who doesn't think this is an important issue.
Senator Schumer, et al: wouldn't you like to stop being a whore, or are you so vested in business-as-usual that you can't conceive of doing it any other way?
I wish people would stop referring to people like Schumer as whores. Whores work for a living.
One of my pet peeves: One of my credit card issuers, if I make a phone payment to get in under the deadline, will charge me $15.00 for that "service." In what way is it more expensive to process an automated payment than to process a mailed check? (The entire process is via touchtones -- no human operator is involved.)
This new policy doesn't seem to help the Paypal(not a bank and not governed by ANY banking laws) users who are getting screwed by Paypal and their Parent company, ebay, EVERY DAY!
STILL BEWARE OF EBAY/PAYPAL!
Paypal's amended User Agreement allows Paypal, at it's "sole discretion" to withhold users funds for 21-180 days, with NO arbitration!!!!
Everyone can thank ex-CEO, Whitman and current CEO, Donahoe, and their "Disruptive Innovation" scheme for RUINING ebay & Paypal!
For users experiences, search the internet for "Ebay Stockholders
and Sellers Calling For Immediate Termination of John
Donohoe CEO".
To hear what their employees are saying about the extremely POOR upper management of ebay/Paypal, go to glassdoordotcom
Yes I agree but this is not
Submitted by Credit Card Processing (not verified) on Mon Apr. 13, 2009 1:17 PM PDT.
Yes I agree but this is not just the fault of paypal or ebay. or for that matter any company that offer credit card processing. PayPal has been doing a much better job of fighting fraud and scam since their inception. They all struggle with this even the major banks such as bank of america, Chase and Google Checkout, etc
Just when recession evolved,
Submitted by Neil L on Thu Apr. 16, 2009 1:18 AM PDT.
Just when recession evolved, financial mistakes set in. Everyone needs some short term financing now and again. Eventually some of us want to own homes, so if your credit rating isn't exactly good, then attempting to repair your credit would be a good idea. Well, getting payday loans now and again to make higher than minimum payments isn't a bad step to take. You might also make some alterations in your personal budget to make more payments and get out from under the cloud of debt. It could save you from worrying about payday loans later on if you repair your credit.
Credit card problems
Submitted by Gyro Tyro (not verified) on Fri May. 15, 2009 12:37 PM PDT.
There is always one solution that I find ALWAYS works 100% of the time. In t he event I do not agree with the wa y the CC company is treating me and I cannot make them see reason, I always have the option of FIRING THEM. I did this with the phone company when they put extra charges on my phone bill. I fired them and got my first cell phone, even after numerous appologies from the phone co I would not go back to them. Same thing with CC companies, If they change the terms of the agreement and I do not agree to these new terms I will FIRE THEM and either do without credit cards or go to another company.
Works every time it is tried.
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Defeat the FairTax SCHEME . . . It is a Double tax on savings already taxed and decimated by the income tax system and bambam's redistribution of assets failure. Even Boortz/Rep linder, both proponents of the Scheme, admit on page 176 of his FairTax Scheme book that it is an unfair tax on savings and savers.
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Repeal the WEP Windfall Elimination Provision of the SSA. It takes one half of the EARNED benefits of some SS recipients and often leaves them in poverty.
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Do You Pay More Tax or Interest?
Submitted by Avery Ray Colter (not verified) on Tue May. 19, 2009 11:09 AM PDT.
Those on the right of the economic sphere always talk about taxes, or government fees of other kinds. They make this "Tax Emancipation Day" thing to propagandize about how much of one's income is lost to the government. But I have one question: at what income level is someone's taxes on average more than the interest they are paying? Sure, nominally single middle class workers are levied at a 25% rate on taxable income, but after allowances and standard deduction taxable income can sometimes be little more than half of gross, which means 12-15%. And if your income is lower, taxable income is even a lower percentage of gross. It's lower middle and middle people who are running up insane balances on their cards, because you have to pay for March's food with February's paycheck, because one of the vehicles or the house needs something repaired, because a medical issue comes up. People get work hour shortages, or get let go and have to pay for food and fuel for months on unemployment, if they are lucky to get it, while "making finding a job a full-time job" - doesn't this qualify as forced uncompensated labor? Is this not literal slavery? So a half a year can go by, and even cut back expenses can (and in my case has a few times) rack up several thousand dollars in charges one then is expected to dutifully pay back at whatever interest rate they pull out of their asses. Indeed, somehow you have to pay the minimum charges on this BEFORE you find another job, which amounts to making us into mere pipes for running a torrent of government money right into the banks' vaults. You're sure paying a lot more interest than taxes in that state! And yet it's OK if a private entity does it.
Here's a solution for you: the federal government should order the Reserve to directly take over all credit card debt at prime rate and deposit all interest in the general fund. The deficit could be handily reduced, consumer confidence would be much improved, income would fill the government's coffers without any taxes, and the officials would be regarded as the saviors of the masses. If the Reserve refuses, the government should seize its rightful authority to mint currency, fiat or not.
I suppose some would say that consumers would run up debt and default on the government. I say they are likely to do so no more, and possibly less, than they are already doing with the banks, which are running to our government for bailouts anyway.
For now, lacking this option, I am looking into using the one bright spot in this whole picture for a mortgage payer, the decimation of interest rates, to shift my debt from large institutions to the local credit union in which my company has our Health Savings Accounts. To my knowledge they have not engaged in subprime or liars loans or these other tricks, and at least capitalists who keep their capital in a community sucks less than one that sucks it all far away.
