Credit card reform leaves small biz out
Washington's credit card crackdown applies only to personal cards, leaving some small businesses unprotected. What do you think of the new legislation?
From Ray, Encinitas CA This country as a whole needs to start accepting responsibility for their actions. I have horrible credit, low 500's, and I accept that my irresponsibility when I was younger caused it……not credit card companies or banks that gave me their credit. Every person that signs a loan document or accepts a credit card signs the agreement showing all the rules. If you don't like that the private company that is offering you credit can increase rates then don't get the card. I am getting sick and tired of the responsible people getting stuck cleaning up for the irresponsible.
Also, If you bought a house that you couldn't afford than you deserve to lose it. The home loans signed specifically stated the conditions of, no one held a gun to your head to buy a house that was way out of your price range. For those that have hit hard times and are in trouble, deal with it. It's a fact of life.
From Patrick, Middle Island NY January 2009 my interest rate on my washington mutual card was 6.99%. Chase sent me a letter that i did not open, telling me that they bought my account and the rate was now 10.99%, and if i wanted to opt out i could. Needless to say, i did not read the letter in time because i didn't feel i was obligated to read every 3rd class letter mailed to me. To no avail, they stuck me with the higher rate. The anointed one passes the bill and today 5/26/2009 i get another letter from chase (this time i read it) stating it will be raised to 16.99% if i don't opt out by 6/22/2009. UNCLE, STOP. My FICO is almost 800 and i deserve better treatment. I am opting out and the credit card comanies can choke on there interest, I'm GOING CASH OR NOT GOING.
From G.C. Troy, MI Completely agree with Bill Kidron! I will switch to cash in a heart beat if they charge more for every transaction. I don't believe these bills are there to protect the responsible consumer who pays off their balances every month, on time. It's a cover to basically shift the burden from those who cannot pay, to those who can and are able to.
From Paul, Denver, Colorado I have never had a problem with any of the credit card companies. I pay my bills on time, have low utilization and I keep my nose clean. But other Americans cannot seem to get their act together, so they went and cried to King Obama and he passed these laws. What will happen now is that interest rates will be increased for everyone, credit lines will become smaller and obtaining a new card will become difficult regardless of your credit standing.
American's have become whinny tyrants. Come on people, take responsibility for yourselves. The banks didn't hold a gun to your heads to make you spend. You did that on your own. The funniest thing is that these same people who whined to the government will be the same people who cry foul the next time they apply for a card and get 18% APR and a $2,000 limit.
From Bill Kidron, OH Obama needs to stop messing with companies and think he can control and take charge causing a Socialist nation.
It is scary the things he is doing. I will stop using a credit card if he tells the credit card companies to begin charging me more for every transaction. We will go back to a cash society. This is actually good. People will begin to buy and pay for only the amount of money they have. Good for retail stores, restaurants etc. because it will save paying the banks 2% of every sale. So some good points!
From Andrew E., Seattle, WA I'm all for the reforms. Chase bank recently more than doubled my minimum payments by breaching their own contract. They sent notice of change and I wrote them to opt out. They say I can't opt out, which is absurd, you can't legally change a contract without the other party's consent. I'm still fighting with them, and they just give the run around. Out of frustration, I even made a web site at www dot boycottchase dot com to help people become aware. The banks have had it coming for a long time. If this new bill makes less credit available to consumers, then that's a good thing. We need to learn to rely less on credit. I wish I had in college. I got suckered in and ended up paying my tuition on credit cards. Ten years later I'm still paying them off. If I had it to do over again, I just would not have had them in the first place.
From Claude Suddreth, Phoenix, AZ I think this is a very very good first step. This is far from "useless legislation" as others have commented – rather this is a continued step along the path of financial reform that our country needs. Having worked for a credit card issuer in the past, I am well aware of the highly predatory nature of many of these lenders, which often go beyond predatory and into unconscionable levels. And they are able to do this mainly because of their close ties with the 3 credit reporting agencies, using essentially blackmail tactics to tell you that you must do things their way, or they will do all they can to ruin you for the next several years. You must understand, bad credit is no longer about simply credit. It also affects your ability to obtain certain types of employment, to pass various background checks, and can even be used as a measure of the person and how reputable they are. All of this being controlled by companies that had the ability to double cycle bill you, issue credit to the unqualified at inflated interest rates, hugely increase your rates on all cards because you have a dispute (read did not pay) with a totally separate creditor, and on and on and on. This bill is far from perfect. But it is a step in the right direction and I will say only – THANK YOU PRESIDENT OBAMA – and – it is about time!
From Gladys virella,flushing,ny The credit card issue I thought was fine but the only thing I did not like that they brought up with the credit cards was people carrying guns etc. to parks and wildlike refuges. I do find that a big problem. I can just see all the damage they would do to the animals and wildlife.
From Brian, Sioux Falls, SD All of this regulation should be thrown out the window. I can't believe that with our budget and financial crisis' in play that our government is wasting time on useless legislation.
We've all signed the same credit card contracts that say they can raise your rates at any time for any reason. If you don't like the contract, don't sign it. If they raise your rate, transfer the balance to a lower rate card that wants your business.
Let Capitalism prevail and allow fair competition for your business sort this out. If the credit card companies want your business they will compete for an honest rate. If they need to adjust the rate to cover charge-off losses then let them. Fiscal responsibility on the part of the credit card company should be encouraged not regulated. If only our elected administration was as responsible.
If the credit card companies can't charge the interest or fees that they need to in order to maintain a profitable portfolio they will be out of business like their mortgage counterparts. Credit card companies provide millions of decent paying jobs in this country, everything from the issuing company to the postal worker. Loss of their incomes and their investment back into this economy will only make things worse.
From Melissa, New Orleans, LA I was worried when I heard that it wouldn't take effect until next year. I feel much better now that I know Obama is listening and is going to protect us by instituting it earlier. Good. This is exactly whats needed whether the small business' think so or not. If the small business' want change, then they will need to get it through at some later date. Not everything is going to be fixed at once, whether they want it to be or not. Thats life.
From Robert, Longmont, CO This bill, while it does some things to appease credit card holders, really won't change things much in the long run. That's because, while directed at credit card companies, the real purpose is to protect us from ourselves, and as a country we've proven time and again our ability to do stupid things. All of the practices outlawed by this bill are (were) legal, and disclosed in the fine print, if we had chosen to read it.
As a nation, we've essentially said to Congress, "We're too stupid to manage our own money properly; please fix it so those bad "big banks" can't make money off our stupidity."
Unfortunately, no government can outlaw stupidity. Perversely, no matter the barriers set in place, the stupid always seem to find clever ways to allow their stupidity to flourish. And there will always be smart people willing to figure out ways to make money from that tendency.
From JH, San Antonio, TX Credit Cards are the worse thing for my small coffee house when i have to pay visa, mc, discover etc 15 to 20 cents per swipe for each sale. My sales are usually under 2 or 3 dollars so there goes my profit. Customers can't wait to use their point cards so visa and master card can reward them. I inform my customers that their reward/points comes from my store as we, business owners have to pay visa and mc even more per each swipe for their points. The "convenience" of using plastic comes at a huge price to customers and small business. "Someones" making big bucks and it ain't us. And I agree, Advanta is horrible, they also raked my interest to 39%. Got rid of them fast.
From James A Keddie, Richmond, TX As the owner of an L.L.C. … i'll switch to using personal cards…..
From Ian, Houston, TX I am totally disgusted with inability of the US government in this matter. For years we heard the same song with different tunes. Consumer protection does not exist in this country. They have done the damage already and still doing it even after the law has passed. You are on your own people. Don't rely on the government to save you.
From fctx, dallas, texas the Dems don't care about small business. to much hassle to nationalize them, so focus that effort on the big companies and let the small one just "die"
From Vinie, Omaha, NE I'm tired of the posts stating this will only help the irresponsible. I went through some hard times and was forced to use credit cards to stay afloat. After getting things straightened out and having been paying them off for a couple years or so and not missing a single payment, I recently received a notice from Capital One stating my interest rate will be increased from 10% to 17.5%. No hassle huh?
From Alan, Bonita Springs, FL I think it's time that Americans revolt against the abusive practices of these companies. Their actions are criminal and their rates userous. Simple as that.
If we all do this it will work:
Everyone stop making payments. Today. Right now.
When the card company calls to ask where your payment is, ask them if they took bailout money. 95% of the time the answer will be "yes."
Then — tell them "you've been paid."
And hang up.
Sure — it will hurt your credit. But credit scores are an average of all of us. If EVERYONE does this ALL our scores will go down and LOWER scores will become better scores.
From Randhir. columbus.Oh. This is only one step in the right direction.
To help the card holders the new law should be implemented with immediate effect retrospectively from Jan 1st, 2009.
Also to protect small businesses, the card companies should be made to undo all the various charges levied on the businesses AFTER the first contract was entered into. And no more charges should be levied.
Further, the credit card companies levy heavy extra charges on businesses for "settlement of transactions, monthly maintenance fees, shipping charges for paper etc, monthly dues etc etc etc. " All these should be abolished.
This is U.S.A. not Sicily ruled by Mafia.
From Shane. Tampa, FL I think it is a step in the right direction but it is not going into effect for about a year. This gives the credit card companies a year to screw us, change interest rates and fees in anticipation of the new rules. Credit card companies are notorious for coming up with new fees and ways to get around the intent of laws. I personally think there should be a consumer credit czar in this country to review the practices of credit companies on a yearly basis and make changes that go into effect yearly in February or March.
From Michael, Freeport, Maine As per usual legislators are pandering to the irresponsible. Almost everything they do sounds good but usually does not really do what is needed. If credit card companies start charging fees to have cards or fees/interest on people that pay their total balances each month Congress will have struck again. It is ironic that you quote Senator Dodd "Mr. I got a sweetheart Countrywide loan", this guy is a joke.
From Shant, Los Angeles CA I don't like the bill at all! It only helps irresponsible borrowers who spend more than they can afford.
It does nothing for responsible borrowers who use credit wisely. In fact, it punishes them with higher interest rates, higher annual fees, and loss of a grace period. All this to make up for lost revenues under the new bill.
Another bill to bail out the irresponsible. From home loans to credit cards now. What is this administration going to do to reward responsible people? Might as well join the bandwagon and spend like crazy and be bailed out. That's what these new policies are encouraging us to do.
From Lacyt, Waco, Texas All of you commenters above –
Let's hear your plan.
From Kevin, DevonPA Congress needs to step aside. Markets will regulate themselves if you let them. We have become far too dependent on credit in the first place. I say – let the poor lendors and lendees fail, go bankrupt, and let the system cycle. It may seem unjust, however, that is the "fix" we need. We cannot keep spending as we are. Congress needs to do the same thing – stop spending, and stop interfering in the market, trying to save "Main Street". We can and will recover on our own.
From Michael, Palm Spring, CA It is a little late. Credit Card companies began increasing rates to beat the start date of the bill. I had my rate increased by almost 15% last week with Chase. I maintain no balance on the card, nor have I used the card in 8 months.
From Susie, Capistrano Beach Does very little to help consumers. I should go into affect NOW and the rates should have a cap. No one paying 39% can ever afford on a fixed income to pay off this debt. What do you expect Congress along with the President sold out to Bankers. They are the ones who made all the money and will continue to do so until hte American people wake up and do something about it.
From David Hazzard As usual small business is left out. Just proves once again legislators could care less. The sooner small business folds up and goes away the better they'll like it . . . until we're gone and the U.S. becomes a third world country.
Big corporations = monopoly
Small Business = innovation
Where will we be without innovation?
From Dennis, Knoxville TN The law is too little, and far too late. There should have been retroactive aspects concerning interest, and fees. Further, they should have made the interest limits subject to the usury limits set by each state. Many of these new interest rates being charged are far beyond the limits established by the states.
From Nan Lin, Chester, PA This bill is rediculous. Does it really help consumers??? It helps inresponsible consumers who borrow more than they can afford and pay late. And it hurts the good consumers because they have to pay higher fees to cover the lost profits of credit card business. I am not saying credit card companies are perfect and they do need to change some unreasonable terms. But don't overkill them. Credit card brings convenience and even rewards to consumers if you use them wisely. Credit card companies are business to earn money like every other ones. This bill sounds like punishing good people and relieving the inresponsible ones.
From Gayle, Richmond, MI It's too little, too late. They've already skyrocketed the rates with no provision in the bill to bring them back to a reasonable rate for card holders who haven't missed any payments. Worse yet, they're giving the credit card companies the rest of the year to financially rape us with fee and rate increases before the law goes into effect.
From Richie, Milwaukee, Wisconsin Are the credit card companies going to retaliate against the millions of people who pay their balance each month by charging interest from the day of purchase? Many people, including myself, use this convenience to avoid carrying large sums of cash and becoming a victim of preditors. Have the "einsteins" in Washington considered this?
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whatever damns and repugs on the hill does, they do for their neo-con loan-sharking masters on wall street. no need to read the fine prints to understand who benefits. people could stop consuming everything corporates offer and bring down the modern day slavery, but the majority rather bet on their minimal odds for becoming part of the loan-sharking elite group of 400 families who own much of the wealth and power of this terrorist nation. we deserve what we get. you don't like what capitalism does? then vote for socialism / communism in the next election. don't complain when you lose and the other guy wins once you buy into the capitalist game. you got no friends on your side.