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methinks2 Donating Member (894 posts) Send PM | Profile | Ignore Wed Jul-20-05 02:30 PM
Original message
Credit Card payments to double?
A friend just reported that she heard on the radio this morning that congress is preparing to allow all c/c companies to double the minimum payment due.

Does anyone have any info on this?
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yvr girl Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:31 PM
Response to Original message
1. I heard the same thing on the news this morning.
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shoelace414 Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:31 PM
Response to Original message
2. allow? they should force.
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meegbear Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:31 PM
Response to Original message
3. No overt info on it ....
but remember that "great" bankruptcy that the repugs passed? Well a provision in there allows CC companies to do things like that. And many will be doing it.
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dmkinsey Donating Member (789 posts) Send PM | Profile | Ignore Wed Jul-20-05 02:37 PM
Response to Original message
4. Don't know, but
It would really be in the CC company's interest to continue with super low MINIMUM payments as they have currently. This produces maximum income via interest accrual over extended time people will be paying IF they send minimum payment only.
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methinks2 Donating Member (894 posts) Send PM | Profile | Ignore Wed Jul-20-05 02:37 PM
Response to Original message
5. looks like someone started another thread on this,
I'll join that one.
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MissB Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:38 PM
Response to Original message
6. There was a thread here yesterday.
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proud patriot Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:38 PM
Response to Original message
7. Yep ...here's the link
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soothsayer Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:38 PM
Response to Original message
8. Actually protects consumers---otherwise if you make minimum
payments, it takes 20 yrs to pay something off (or something to that effect)
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question everything Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:39 PM
Response to Original message
9. Probably a good move
People do not realize that by paying the minimum amount they will never be free of debt and may end up in bankruptcy. And, remember, the bankruptcy laws changed earlier this year.

Frankly, people should tear their credit cards, keep only one for emergency or when are in tight spot. Or when losing a job.

Remember, when people cannot pay their debts - we all lose. The credit cards companies do not lose. They just increase the fees on the rest of us, or use them as write off to lower their tax liability.

Similarly, people should buy houses that they can afford, using conventional mortgage or at least one with a fixed rate for several years, not optional interest only where interest rate can change every month, resulting in negative amortization. This will keep the spiraling house prices in check, and will prevent a "bubble."
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DCWageSlave Donating Member (12 posts) Send PM | Profile | Ignore Wed Jul-20-05 02:41 PM
Response to Original message
10. Credit cards are a very bad deal
Do the math on credit cards... in almost every case they are a bad deal for the customer. Better to tighten your belt for a few months, save 1 month's expenses, and be your own 'lender' and use a debit card instead. Finance payments should be avoided as much as possible, otherwise you're paying money for nothing in return. Only in the case of something like buying a house or a car should you consider borrowing money. You're going to have to pay eventually for what you spend, why spend more than what things actually cost by agreeing to financing charges above and beyond the price of what you buy?
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:49 PM
Response to Reply #10
13. Welcome to DU Wage Slave-
Edited on Wed Jul-20-05 02:50 PM by BeHereNow
And you're right, cc's are not a good deal for most people
because most people do not pay off their monthly balance.
We do not purchase ANYTHING on credit that we can
not pay off at the end of the month.
Our only debt is our mortgage and it is a fixed rate that
we can manage.

The problem is, not everyone is as financially stable
as we are. More and more people are using credit
cards for the basics, which are increasingly more
expensive. These new laws are going to wipe them
out of the game completely.

It's going to get ugly...and heaven help anyone
who faces a medical crisis on top of the rest
of it.

BHN
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newyawker99 Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 05:02 PM
Response to Reply #10
21. Hi DCWageSlave!!
Welcome to DU!! :toast:
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ThomWV Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:45 PM
Response to Original message
11. It Would Have Bankrupt Us - Just 6 Months Ago
We were maxed out on a couple of cards and high on a couple of others. I worked an absolutly dead-end Government job (GS12-maxed out at step 10)) with no chance of it ever getting better. If I had not taken an early retirement, dipped hard into my savings and used it to pay off every bill we had, we would have collapsed with increased monthly payments.

You had better believe our situation, prior to the payoff, was not uncommon.
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CoffeeCat Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:49 PM
Response to Original message
12. If you read the fine print on the credit-card application---
You will see that credit card companies have the right to do whatever they want to you. Whenever they want.

They can raise your interest rate--without warning and without notifying you.

They can call in the entire amount of your outstanding balance, if they please.

They have you by the bells.

I saw a Frontline special on credit-card companies and how anti-consumer they really are.

Also--the new bankruptcy laws make it impossible for someone to avoid paying. You have to pay now.

So--if these companies want to double your payments or increase your interest rate several points---you MUST pay what they demand and there is no getting out of it, due to the initial contract signed and the new bankruptcy laws.

Recipe for financial disaster.
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Hong Kong Cavalier Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 02:52 PM
Response to Original message
14. Mine's already jumped up. Not double, but it did increase.
Lovely. This will probably break me.
And to all of you will probably say "well, it's your fault for spending that much" I tell you this: I was unemployed for seven months. No health insurance for seven months. Guess where my credit card was used...
This will break a lot of people. I can't see how anyone can say "this is a good thing for the consumers."
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 03:01 PM
Response to Reply #14
15. Your reality is very common today
The fact is, rather than deal with the dismal
truth that most Americans don't make a living wage,
even IF they have a job, don't have insurance, medical
or otherwise, and in general that our economy has
failed miserably since the tidal wave of
corporate mergers and out sourced jobs-
the whole thing has been covered up by
the transition to a debt driven society encouraged
to use credit to maintain a way of life that simply has
not existed for decades.
They knew this was coming eventually, as a matter
of fact I would guess it was "the plan."

In the end, they will own everything
and screw the rest of us.

BHN
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barb162 Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 03:05 PM
Response to Original message
16. It's been around the news the last few weeks
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slackmaster Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 03:09 PM
Response to Original message
17. That's actually in consumers' best interests
Except when you are in a serious financial pickle.
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 03:20 PM
Response to Reply #17
18. Define financial pickle-
Edited on Wed Jul-20-05 03:21 PM by BeHereNow
If you and I agree on what constitutes a pickle,
then that is just about everyone I know.

Most American's, with or without debt are
one paycheck away from homeless.

It is rare today that a full time worker
can actually save any money. It is spent
as soon as it's made. And with the cost
of living skyrocketing against wages that
are not, just about everyone I know
has resorted to credit for unexpected
but necessary expense.

I have two friends that have declared
bankruptcy in the past year, full time
workers. One is fighting cancer, and
the other simply could not keep up with
the cost of living, even as a full time worker.

I think America has become one big
pickle jar- and we are going to see
massive changes very soon under these new laws.
Banks will be collecting those new trucks, houses
and wages, if there are any to collect.

BHN

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slackmaster Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 03:25 PM
Response to Reply #18
19. I mean someone unable to make more than the minimum CC payment
Which is a pretty dire situation.
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BeHereNow Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Jul-20-05 03:30 PM
Response to Reply #19
20. Then we agree- that is most Americans
Edited on Wed Jul-20-05 03:31 PM by BeHereNow
If they lose a paycheck, most people
can't pay the minimum.
That's exactly why we don't charge
more that we can pay in TOTAL every month.
Under these new laws, if people miss even
one minimum payment, then it will be a disaster
for them- especially if they lose their paycheck.
BHN
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