Credit Cards

[Chris Fleming]

Glad this passed today:

http://finance.yahoo.com/banking-budget ... ns-for-You


What's funny is that there was an article in the paper just today about how credit cards want to make some changes of their own. Namely, they want to bring back annual fees, more hidden fees, etc, aimed mainly at people who pay their cards off each month, who they call "dead beats". The language that was used was rather insulting...that people who pay their cards off are "getting a free ride" and "are taking advantage of the credit card companies". Looks like they won't be getting their way. Too bad, so sad.

[chud]

Just goes to show you what jerks they are. They love the people who carried balances who they could financially rape on a monthly basis, but anyone who pays their bill off each month is a "dead beat" and is "taking advantage". Screw 'em. I'm glad the credit card companies are finally getting the short end of the stick.

[Teazer]

This is going to be interesting to watch.

"No more double-cycle billing."
->No more having to alternate credit cards every other month to avoid interest. Me like!!

[mrtoes]

It's interesting to note that in the UK you can get a bad credit rating by paying your credit cards off each month. Basically a credit rating - with respect to credit cards which is different to a rating that would be used for a mortgage - is a rating to indicate how profitable you are to a credit card company. A good customer is one who is constantly a month or so behind on payments but always catches up in the end.

[Chris Fleming]

I say fuck 'em. If a company says they will start charging you in some form for paying off your bill each month or spring some annual fee on you, I'd just cancel it. I get that CC companies can't stay with certain perks that used to be the norm like cash back or miles. I also get that perhaps the idea of the CC itself is changing to be something more like a charge card, rather than a reserve of credit you could use in emergencies. But then if that's the case and it goes that way, then there is no incentive for having a credit card at all and I would gladly just use a debit card.

[cerebus]

Oh, lemme tell ya! I just had my credit card CANCELLED by Wells Fargo. Why, you may ask? Did I miss payments? Nope! I used my card, then paid it off in full just a couple of months later. Therefore, they don't view me as being worth the trouble of possessing a credit card. I called to find out about this and the guy who answered was very polite.... until he looked at my record and saw that I paid my card off within just a month or two of using it. Then he became totally snide and condescending toward me. Finally, when I asked if there was anything in the credit card agreement about canceling a member's card if they paid it off successfully shortly after using it, he said "Well, SIR, we reserve the right to alter the agreement at our dicretion for any reason we see fit." I wish we were face to face so I could slap the snide tone outta his voice for him...

[Steve James]

Yeah, it's true, cc companies make their money from the finance charges. Otherwise, why would they let you use their moeny. If you pay off your bill, they lose money. But, their practices have been abusive because there were no laws to prevent them --precisely because of the argument for a free-market.

Anyway, for some reason, you'll take a hit on your credit rating if your cards are cancelled --but that's what many companies will do, if you have a large limit but no balance. So, it's often best to "keep" a small balance. The company can't cancel you, and you will stll make the ccc a bit of money. What'll probably happen now, though, is that the companies will lower limits and increase rates. If you need to use them, it'll just cost more... which is fair. Though I still think that a 29% interest rate should be against the law.

[Chris Fleming]

Oh that same thing happened to me with one of my cards. They are certainly within their rights to do so, as that is part of their agreement. It's just stupid though. I do my utmost to NOT contact any CC company by phone, as I hate dealing with those operators, so I used their "contact us" email on my account. They brushed me off in a similar way, and then went on to say some bullshit about they hope I have enjoyed using the internet to pay my bill! Like no one else does that!

Debt is slavery, and I have no intention to try to placate them in order to remain a card member. If you can't pay it off each month, then don't be buying shit. If they cancel you, in a sense they are almost doing you a favor. Like I said before, I would just as soon use a debt card if there's no point to credit cards. If people did that, the free market will speak quite loudly to them.

[cerebus]

Yeah, the whole system sucks for the customer. Back before I used my CC, my credit rating was listed as "Good", then I used the card and paid it off, now it's listed as "Poor"... WTF!!? CC companies suck ass...

[Michael]

"Well, SIR, we reserve the right to alter the agreement at our dicretion for any reason we see fit."

Even Tony Soprano would give you a fair shake compared to that.

Here are three excellent documentaries about credit cards. I wonder if most people can get through them without breaking something because they show what sophisticated crooks the CC companies are.

IMDB entry Maxed Out: Hard Times, Easy Credit and the Era of Predatory Lenders (2006)
Fan site click me

We're all led to believe that people get into financial trouble because they are irresponsible, but I've learned that most people are getting in trouble because the banks and credit card companies are setting their customers up to fail. Why? The more credit they give us, the more credit we need. When we inevitably fall behind, they can charge the huge late fees and the over-limit fees and the stratospheric interest rates that drive their profits.

Frontline: Secret History of the Credit Card

It's one of the most wonderful times of the year for the banking industry's most lucrative business: credit cards. In the coming weeks, millions of Americans will reach into their wallets and use plastic to buy an estimated $100 billion in holiday gifts. But at what cost?

In "Secret History of the Credit Card," FRONTLINE® and The New York Times join forces to investigate an industry few Americans fully understand. In this one-hour report, correspondent Lowell Bergman uncovers the techniques used by the industry to earn record profits and get consumers to take on more debt.

In Debt We Trust

Just a few decades ago, owing more money than you had in your bank account was the exception, not the rule. Yet, in the last 10 years, consumer debt has doubled and, for the first time, Americans are spending more than they're saving -- or making. This April, award-winning former ABC News and CNN producer Danny Schechter investigates America's mounting debt crisis in his latest hard-hitting expose, IN DEBT WE TRUST.

Watch In Debt We Trust on Google Vid

[chud]

Thanks for the links Michael.
Maxed Out and the FrontLine documentary are both excellent. Maxed Out shows the human side of how credit card debt affects people (there are some sad stories in there), while the FrontLine documentary does a good job of giving you the whole sordid history of how certain laws allowed the credit card companies to become what they are.
I haven't seen the last documentary you mentioned, I'll check that out tonight.