{(Short policy paper on bottom, press release on top)}Edwards Outlines Plan to Take On Abusive Lenders and Help Increase Families' Savings
Will Crack Down on Credit Card Rip-offs and Give Families Alternatives to High-cost Debt
John Edwards for President
Sunday, December 2, 2007----
Fort Dodge, Iowa – Today in Iowa, Senator John Edwards outlined his plan to take on abusive lenders and help American families save. As president, Edwards will enact strong national legislation to protect families from the most abusive practices in the credit card industries, create a new Family Savings and Credit Commission to make sure that financial services treat families safely, support alternatives to abusive lenders, and help families save and get ahead.
“Debt has become the central fact of middle-class existence,” said Edwards. “For most families, wages have not kept up with rising costs for middle-class essentials like health care, housing and child care. Consumer debt has skyrocketed in recent years and today, half of Americans say they live paycheck to paycheck.
“At the same time, abusive credit card companies deliberately build in tricks and traps for families. Consumers often fail to understand the basic terms of their cards due to complicated and confusing disclosures. Most big credit card companies advertise low rates but reserve the right to change rates at any time for any reason – a single late payment can trigger penalties that raise interest rates to an average of almost 25 percent.
Edwards continued, “It's time we did more than say ‘buyer beware’ while millions of families go broke every year. We should put in place the same consumer protections for financial products that we have for everything else Americans can buy. And when I'm president, I'll do just that by creating new consumer protections against credit-card rip-offs and by helping working families save and get ahead.”
To take on the credit card industry – that has spent $250 million on lobbying and campaign contributions since 1998 – Edwards will:
*
Prohibit the Most Abusive Practices: Edwards will enact strong national legislation to protect families from the most abusive practices in the credit card industries.
*
Protect Families from Abusive Financial Products: Edwards will create a new Family Savings and Credit Commission to review all financial services products marketed to families to determine that terms are reasonable and fairly disclosed.
*
Support Alternatives to High-Cost Credit: High-interest credit cards and payday loans are often the only option for families with unexpected expenses. Edwards will help non-profits and states administer low- or no-interest emergency loans directly to taxpayers.
*
Help Families Save and Get Ahead: Savings allow families to cushion themselves against bumps in the road. Edwards will subsidize bank accounts for low-income workers – nearly 28 million Americans lack them – and create Work Bonds to match their savings.
For more information on Edwards’ plan to take on abusive lenders and help families save, please see
fact sheet below.
http://johnedwards.com/news/press-releases/20071202-abusive-lenders/----
Taking on Credit Card Abuses“The engine of our economy is not Washington, D.C., or Wall Street. It is the tens of millions of men and women in offices, factories, and fields across America who go to work every day. When we stand up for them, our middle class grows and our economy grows." – John Edwards American families are working harder, saving less, and borrowing more just to make ends meet. For most families, wages have not kept up with rising costs for middle-class essentials like health care, housing and child care. Half of Americans say they live paycheck to paycheck.
Abusive credit card companies have launched a sneak attack on the American middle class. Most big credit card companies advertise low rates but reserve the right to change rates at any time for any reason, and a single late payment can trigger penalties that raise interest rates to an average of almost 25 percent. Consumers often fail to understand the basic terms of their cards due to complicated and confusing disclosures. Credit card companies have spent $250 million on lobbying and campaign contributions since 1998.
Today, John Edwards discussed his plan to create new consumer protections against credit card rip-offs and protect the middle class. As president he will:
*Prohibit the Most Abusive Credit Card Practices: Edwards will enact a strong national law, the Borrower’s Security Act, that will require credit card companies to: (1) disclose the true cost of making only minimum payments, (2) restore a 10-day grace period before imposing late fees and penalty rates, (3) apply interest rate increases to future balances only, and (4) end the practice of universal default, where a creditor can change borrowers’ rate based on their debt and payments to other creditors.
*Protect Families from Abusive Financial Products: Federal bank regulators focus on bank soundness, not consumer protection, and federal law prevents states from effectively regulating financial products offered to their own citizens. Edwards will create a new Family Savings and Credit Commission to review all financial services products marketed to families, from six-figure exotic mortgages to $30 bank overdraft charges. It will ensure that terms are reasonable and fairly disclosed. To reduce excess regulatory bureaucracy, Edwards will eliminate the Office of Thrift Supervision.
*Support Alternatives to High-Cost Credit: High-interest credit cards and payday loans are often the only option for families with unexpected expenses. Edwards will help non-profits and states administer low- or no-interest emergency loans directly to taxpayers.
*Help Families Save and Get Ahead: Savings allow families to cushion themselves against bumps in the road. Edwards will subsidize bank accounts for low-income workers – nearly 28 million Americans lack them – and create Work Bonds to match their savings.
http://johnedwards.com/news/press-releases/20071202-abusive-lenders/
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