Canceling my card

[GREENBACK]

I have read that some businesses are revolting against the credit card company fees that they have to pay. This is especially true at convience stores. If someone charges a soda for a $1, the store's profit is 5 cents. But, the credit card companies are going to take 3 cents out of the profit from themselves. So the store only gets 2 cents.

I know of at least a couple of buisnesses that have done this for as long as I can remember. I don't blame them And I gladly pay cash at these places.

[Beppington]

Congress's legislation made it harder for them to create the late charges and fees that they have been doing to the tune of billions....billions!

What's wrong with making billions? Who wouldn't want to make billions? I wanna make billions!

But, Congress gave them a year to implement the changes. During that time, they are adding these fees, jacking interests rates to 30%, and reducing the amount of credit extended.

This is exactly what should happen. The banks are finally acting like a responsible entity. Just because someone can fog a mirror doesn't mean they should have a credit card with a $20,000 limit.
But, if they can no longer take advantage of those who are not responsible with credit, then they have to get their revenues from those who are.

I'm not sure how increasing the interest rate to 30% on somebody's existing debt balance, which many probably can not pay off immediately, makes them a responsible entity. In fact, there were (are?) laws stating a max interest rate you can charge, otherwise you're a loan shark who can basically end up enslaving people (foolish people many times, but people nonetheless), letting them get into a level of debt they can never realistically get out of. I thought the figure was 24%, but not sure. What happened to those laws?

[banditfist]

What's wrong with making billions? Who wouldn't want to make billions? I wanna make billions!



I'm not sure how increasing the interest rate to 30% on somebody's existing debt balance, which many probably can not pay off immediately, makes them a responsible entity. In fact, there were (are?) laws stating a max interest rate you can charge, otherwise you're a loan shark who can basically end up enslaving people (foolish people many times, but people nonetheless), letting them get into a level of debt they can never realistically get out of. I though the figure was 24%, but not sure. What happened to those laws?

The billions that they are making in fees we done so based on nefarious events. Double billing cycles, not processing a payment for a few days, thus making the user incur late penalties. Sorry, but those types of events were/are being used to a$$rape those who can least afford it. I have no problem with banks making billions. If someone wants to run a balance every month and incur the interest rates, then great for the banks.

I beleive that the new legislation does affect the ability of banks to raise interest rates. I beleive that universal default is eliminated. So, when you miss a payment on one card, it does not affect your other cards. So banks are doing what is in their best interest....and raising the rates before the legislation goes into effect. Call it the Law of Unintended Consequences.

The limits on how much interest you can charge can be addressed by looking at the corporate addresses of credit card companies. Why are most located in North Dakota and Delaware? Because those states changed their laws to allow for higher interest rates than the rest of the states.

[wincrasher]

All these "changes" really don't mean much when they have already moved almost all accounts to 25-30%, does it?

[Radiance]

My visa from my credit union requires I have at least one transaction a year to waive the $30 finance fee. I think this is sensible.

My other card is an Amex, not aware of any weird rules with them.

[disneysteve]

It wasn't all that long ago that virtually all credit cards had an annual fee. It is really only the past maybe 20 years that no-fee cards became the norm. I wouldn't be at all surprised to see annual fees become the standard again.

[GREENBACK]

It wasn't all that long ago that virtually all credit cards had an annual fee. It is really only the past maybe 20 years that no-fee cards became the norm. I wouldn't be at all surprised to see annual fees become the standard again.

Quite true. Not only a fee but little in the way of rewards. I believe my 1st card was from Chase in the 80's and it had a $25 fee back then. This was considered normal.

[disneysteve]

Quite true. Not only a fee but little in the way of rewards.

Yes. Reward programs are fairly recent inventions also.

I think what is going on now is just part of the ongoing evolution of the credit industry.

[wincrasher]

Well if you remember, back in those days you had a fee, but relatively low interest rates. Also, there weren't really much in the way of rewards.

Now they want fees, plus mafia style interest rates, and to cut the rewards for all but the most prime customers.

They want their cake and eat it too. That's what bothers me. I'd gladly pay a reasonable annual membership, if in return, I get rewards and a low interest rate. Otherwise they can shove it.

The 2% merchant fees (which we consumers pay for BTW) is plenty of profit considering they are borrowing from Uncle Sam for nearly 0%.

So even if I'm a "deadbeat", what does it really cost them anyways? They don't even send me a statement in the mail if there is no activity. Right now I'm just a few data bits on their server, with the potential to earn them merchant fees or even interest.

You'd think the proper course for a money making institution like a bank (remember them saying "we only make money by loaning money"?) would be to come up with ways to entice me to use my card. Not ecourage me to cut it up!