5 evil things credit card companies can (still) do

[Natural Elements]

Credit card companies are socking it to consumers left and right.
They're hiking interest rates to as much as 36% and doubling minimum monthly payments, frustrating customers who are already cash-strapped and credit-crunched.

In an effort to curb these abusive practices, President Obama signed into law a credit card reform act in May that's rolling out in three parts over 12 months.

At the same time, credit card companies have been hard at work coming up with new ways to boost profits while sidestepping the reforms.

"Card issuers are making sure they can make up the lost money in new ways," said Bill Hardekopf of Lowcards.com, a research company funded by a commercial debt collector.

The first part of the law, which took effect in August, requires banks to give customers more notice ahead of major changes to their accounts, like rate hikes. Starting in February, limits will be imposed on when issuers can raise rates on existing card balances, and on new cards. In August 2010 some credit card penalty fees will be will reined in.

http://money.cnn.com/galleries/2009/...ngs/index.html

[South]

Here's how I feel about that.

My grandfather and many, many, other wise people will tell you a good practice. If you can't buy it....don't buy it. If you have to charge it, wait until you don't have to charge it. If you can't buy groceries without a credit card, change you're lifestyle until you can buy them with cash, if you can't buy clothes without a credit card...hit the thrift stores.

Bottom line. If you're living within your means then you have not one reason to use a credit card. If you're part of the "I want it now!" crowd then you're allowing yourself to become subject to the rules of those who own your lifestyle. You don't own it....they do.

Debt is a slippery slope.

[Natural Elements]

I agree with you South,

It is proved that the majority of people using credit cards or revolving accounts will fall sooner or later in the abyss.

The question is why all of these products are available at the first place?

If we take the mortgage industry for example, why products like ARM, teaser interests mortgage, Alt mortgage, etc are available?

How many of us have seen our own house value going down the hill because of these financial products? I am not for regulations on everything, but this is the government jobs to protect people from financial predators.

At the end of this mess, all the healthy people will pay for these financial predators one way or another.

[pvignola]

Cash is king for sure but we also have to make sure we have a good credit rating so we can get a good rate on the mortgage or car loan. I say get a few cards use them but pay them off monthly to keep your credit rating high. I think the credit card companies are among the biggest thieves in any business but they have the money and we want it so we have to pay (dearly at times)

[infocraze]

If circumstances permit, I would also recommend against the use of credit cards. Pople get trapped sooner or later and it all ends up in a huge mess.