Comments on: Obama Looking to Help Credit Card Holders

By: ryan

ryan — Thu, 21 May 2009 00:28:40 +0000

People do need to be accountable for their own spending, however, that is no excuse for banks to cheat and deceive like they do. These are two seperate issues. Unfortunately, I am sure the credit card companies will rush to raise current cardholder rates before the law goes in to effect.

By: rachel

rachel — Fri, 24 Apr 2009 23:57:47 +0000

Just making a law that all fonts in credit card contracts be 12 points or larger and in plain English (lets say a Newsweek- or Time-level vocabulary and syntax) would be helpful for consumers.

By: Paul

Paul — Fri, 24 Apr 2009 21:13:13 +0000

RACKET

By: Paul

Paul — Fri, 24 Apr 2009 21:12:44 +0000

Credit cards are a legalized rasket ! A loan shark would give you a better deal !!

By: ExiledIndependent

ExiledIndependent — Fri, 24 Apr 2009 17:51:24 +0000

Longer term, and perhaps more foundational, is that we need to slowly change consumer behavior away from reliance on credit. A culture where the common person is inherently distrustful of credit, only using it in very limited ways and for brief periods of time, is ultimately more desirable. Addiction to credit is in many ways a fairly recent development (50 years young or younger), so it’s not like it’s impossible to envision a world with more responsible individuals *as well as* regulation that prevents and seriously punishes predatory corporate behavior.

By: shawn

shawn — Fri, 24 Apr 2009 14:54:40 +0000

It’s really bizarre to me how the same people who argue about the importance of personal accountability and making responsible decisions are so often against making it easy for individuals to access the information they need to make the proper choices.

All that fine print that I have to agree to in order to get anything done is complicated and dense, and basically subject to change at the whims of people I’ll never meet. I’m smart, well educated, and even when I make the effort, it’s hard to be sure of what I’m getting myself into.

People don’t have the time or resources to consult a lawyer every time they sign a credit card or a cell phone contract or whatever. It makes complete sense for the government to enforce some basic protections.

By: Todd

Todd — Fri, 24 Apr 2009 13:48:47 +0000

Hi Alan,

The example you gave is bad enough … losing the introductory offer, and paying a high rate if you’re late on a payment … but at least the consumer had some control of that situation.

Even worse, is what some credit card companies have been doing lately. They send you a letter saying that due to some silly reason like “not enough retail activity”, your rates will be going up from 9% to 18%. Of course they give you the option to “pay off your balance and close the account” if you don’t agree with the change in terms.

Legal I suppose, but for that percentage of people out there who really are struggling with credit, it’s essentially lawful theft … they can’t afford to pay off the balance … and they did nothing “wrong” to cause their rates to go up.

Knowing congress, they’ll go overboard, and put together legislation so complicated that nothing gets passed. But, it sure would be nice if they were able to at least pass a rule that says if the card company wants to arbitrarily raise the interest rate w/out cause, it can only be on new purchases, not pre-existing balances.

That seems fair to me.

Todd

By: Mike A

Mike A — Fri, 24 Apr 2009 13:48:07 +0000

I’ve watched over the last 20 years the degradation of consumer protections. As the complexity of life has increased (try decoding your cell phone bill, your medical insurance statements or understanding the mouse-print on contracts) the protection from deceptive billing and other opportunistic money-grabbing practices has faded. My personal belief is many americans are under intentional financial attack, not only by scammers, but by corporations looking to boost profit margins on services. We’ve gone from “the consumer is right” mentality to a “the consumer is ripe” mentality.

Maybe I am jaded as I remember it has not always been this way. I’m also hopeful that it won’t always be so.

By: kranky kritter

kranky kritter — Fri, 24 Apr 2009 13:03:38 +0000

Extending from this to a broader related subject, I think that reinvigorated consumer protection is an area that is overipe for renewed focus.We’ve seen a generation’s worth of the government looking the other way while zeaolous marketing dep’ts have come up with more and more complicated shell games.

A broad effort to rein in abuses would be extremely popular with regular folks. Businesses can of course be relied on to make the argument that such regulations will adversely affect the economy etc etc. But for regular folks, it’s an issue of fairness, equity, and clarity. It’s become routine for marketing departments to sell their products by featuring one attractive aspect of their deal and obscuring all the catches as much as humanly possible.

Essentially, the pro-business argument boils down to “we should be able to continue to mislead people because its good for the economy.

Most people hate this, and would LOVE to see reform. Businesses and marketing dep’ts have had a generation of laissez-faire, and IMO they have shown they can’t handle it.

By: Trescml

Trescml — Fri, 24 Apr 2009 12:40:28 +0000

It shows the strength of the banks that they have been able to keep this off the table so long and that Congress (at least the Senate) is not very likely to pass meaningful legislation. I am glad Obama is trying to push this issues.

I think that not only is there an unhealthy imbalance in credit card companies and consumers, but in general between the financial industry and public.

By: Connell Finance Contributor

Connell Finance Contributor — Fri, 24 Apr 2009 06:18:04 +0000

The problem is that once consumers fall down the hole of fees and interest it makes it nearly impossible to get back out. The companies want consumers to make one late payment so that they can change the terms of the deal and begin racking up all kinds of fees. This along with teaser rates and other promotional garbage, are the kind of shady business practices that cause innocent well meaning people to become buried in debt. Sure not everybody needs a new flat screen tv and new suv but they shouldn’t have to worry about losing everything because they were late on one payment.