Obama Pushes 'Strong and Reliable' Protections for Credit Card Users

[Fieldmouse]

I ask, who is protect every person in America from Obama's out of control spending and his future tax hikes to pay for this crap? It amazes me most will say this is a good thing for him to do but give him a pass on everything else. I personally have had none of my card rates rise and have been all worried and checking regualrly to ensure it hasn't been slipped in on me. So who is this interest rate increase happening to? Credit cards are voluntary, taxes aren't.


Obama Pushes 'Strong and Reliable' Protections for Credit Card Users

http://www.foxnews.com/politics/first100days/2009/04/23/obama-pushes-strong-reliable-protections-credit-card-users/

WASHINGTON -- President Obama said Thursday he is determined to get a credit-card law that eliminates the tricky fine print, sudden rate increases and late fees that give millions of American consumers headaches.

[DougMD]

I wouldn't be surprised if they capitulate in return for bailouts! Rewards for debtors at the expense of those who spent wisely!

[emptyquiver2]

Maybe it pays to not play by the rules.

[Alsatian]

It happened to us. My wife was two days late making the credit card payment . . . the rate was raised from 9% to 24%. She called and complained; no flex on the card company's side; we paid the friggin' cardbalance to zero in a couple of daysand haven't carried any more debt on that card since. I guess the game they are playing is assuming that people who carry debt on a card and miss a payment can't pay off the card like we did. We are entirely solvent and have no problem covering our bills. My wife has the mind set, however, that she doesn't like to pay bills early. What happens sometimes is that she gets distracted by other activities -- we have three kids -- and things fall on the floor. Not often, but it happens. This also happens because all the different payments occur on different dates. So you get these payments queued up in your electronic banking system . . . but you have to approve the payment. If you are waiting to the last day to click that approve button and you get distracted . . . you make a payment late. I think it is dumb: no real money being saved, and then you screw up sometimes . . . but I also don't want to muck around with paying the bills myself. Most folks accept your explanation when you have a long history of payment and good credit rating. This one card didn't. 24%. I can't see anything other than predatory gouging that explains raising a rate from 9% to 24% for people who keep their bills paid; keep their debt pretty darn low; and have a strong history of increasing income.

I haven't heard anything that I didn't like about the Obama credit card rules. On the other hand, one has to be on the look out for unintended consequences. I would expect an unintended consequence of this change would be that some marginal people are going to have a harder time getting credit cards or are going to get stuck with a higher rate from the onset than they otherwise would have. Likewise, credit limits are liable to be dialed down. But I don't think these effects are necessarily bad -- I think they may be good. Preventing people from harming their own financial interests -- if you can't manage your finances to handle a $25,000 credit card limit, you're only going to get a $1,000 limit. That could be argued to be an undesirable manifestation of a nanny-state, but it seems some people need this kind of external self-discipline imposed upon them. Makes me think of the Aristotle discussion of the "natural slave" in the Niccomachean Ethics. You don't have to read that passage to mean involuntary servitude: you can read it on people who need to have others manage their affairs for them because they never mature sufficiently to make sound decisions for themselves. Some folks are better taking a job working for someone else (kind of like a slave, right? right?!) rather than starting their own business. The logistics and planning into the future needed for running a successful business isn't everyone's strong suit.

[Mr. Conservatism]

The credit card issuers have been guilty of usuary for a long time.
The Democrats have been in control of congress since 2006.
Why are they just getting around to doing something about these loan sharks?
These people contribute big bucks to political campaigns...so I'll believe it when I see it.

[Howler]

SO, if Obama forces the creditors to get rid of "late fees" what will be the incentive for people to pay thier bills on time. Of course, the way things are going, seems like there's more incentive to "not pay" because the gooberment will pick up your tab anyways, and let the "payers" carry the debt!

I had a credit card company raise my rate on a credit card, about a year ago. Both my wife and I have very good credit ratings. I've not been late on any payment, phone, electric, land, mortgage, etc. (although phone and electric, dont' count on the credit rating)for over 20 years. When I called to cancel the credit card, because the only other card that I have is at a lower rate, the credit card company couldn't understand my reasonfor cancelling the card. OF course, I argued that I couldn't understand why they would raise the rates on my card since I had NEVER been late on a payment, and often didn't carry more than a zero balance. AND that right there is why I think they raised my rates, because of the fact that I often carried zero balance. Just a guess on my part, they obviously failed to give me a "reason" for raising the rates.

One thing that I have noticed, we used to get several credit card applications a week in the mail. They have pretty much dried up. Yeeeesssss. Less junk mail is a good thing!

[hillbillyhunter1]

I've been hit but not hurt by the new credit card financial tightening as well. I had a $100.00 invoice from the local "fire service" that I let go a bit too long (As homeowners in this county, we pay a yearly "fee" for ambulance and fire fighting service)

Anyway, I've got excellent credit other than that and had about a 120,000.00 limit on multiple cards combined. It's how I financed my business. Now though, because of that one infraction used as their excuse, they have really lowered the ceiling on my credit limits. All cards that I have a balance on except one have had the limits reduced to hover just above the balance, which is usually several thousand dollars.A couple have also had the apr increase bya half dozen points ( from around 7 or 8 % to 13, 14, etc).

Thankfully my business has increasedrevenue by about 25% this year and I've been able topay off substantial chunks of debt and keep a nice cash reserve to hopefully last (supplemented by some marginal non-season business and another part time job) the rest of the year, barring accidents.

I can see however, how a struggling or brand new small business might really be put in dire straits by these new credit parameters that seemed to happen overnight and with absolutely no real notice.

If the new administration takes some positive action on this front then I have to say "good job" no matter how long it took anybody to do something.

[Fieldmouse]

If the new administration takes some positive action on this front then I have to say "good job" no matter how long it took anybody to do something.

I can't wait until Obama caps tax preparers fees to $15/form. It's not fair that we have to pay taxes but then to have to pay such high fees just to be complient with the law is outragous.

[Dangermouse]

My experience with the Credit Card comps has been the same as a lot of you. I got hung up at work. I think I was 2 hours late on a payment(over the phone). And they wanted to raise me from 2.9% I think to 30%. I just did a balance transfer to another card. I usually dont dont cut it that close, but a in-law had been coming over throwing all my unpaid bills away. Yes , I feel the love my inlaws have for me

What is really surpising that the Repub party did not do this when they had the chance. They could have tried to make some inroads to some swing voters, yet failed to grasp the situation in time, or was were just bought off. A few things like this and Congress may have not been lost.

Makes you wonder where party leadership's head was at.

[Fieldmouse]

What is really surpising that the Repub party did not do this when they had the chance. They could have tried to make some inroads to some swing voters, yet failed to grasp the situation in time, or was were just bought off. A few things like this and Congress may have not been lost.

It's really scary when I've just read two posts from people who look towards government for their irresponsibility. This country is so doomed.