Jason

Credit card issuers are responding to record defaults and new regulations by breaking a few records of their own. Banks such as JPMorgan Chase and Citigroup are jacking up interest rates and transfer fees to levels not seen in recent history, hitting record numbers of consumers.

JPMorgan Chase, the biggest credit card provider, has levied some of the largest increases. The bank raised the minimum payment on outstanding balances from 2% to 5% for some customers, according to a June 30 Bloomberg article. JPMorgan has also raised its balance-transfer fee from 3% to 5% -- the highest rate among the large consumer banks, according to Bloomberg.

Citigroup has reportedly raised rates on outstanding balances nearly 3 percentage points to an average of 24% for 13 million to 15 million cardholders, according to a July 1 article in the Financial Times. The new rates impact customers with Sears and Macy's cards issued through Citibank.

http://articles.moneycentral.msn.com...-up-again.aspx

Drew1369

But the law is a good thing right?

right?

yustr

Blaming this on the recently passed law obfuscates the fact that it is all about greed.

They're raising fees and rates now to make up for the loss of profit that the law might bring; 29.9% - are you kidding me?

So before you blame congress (of whom you know I’m no fan) think about your blindness to the harm that has been done and is being done in the name of greed. I have no sympathy at all for these loan sharks.

JPMorgan CEO Dimon received a pay package worth nearly $29 million in 2007that included a $14.5 million bonus. In early 2008, he also received stock options valued at $19.8 million for his performance in 2007. But then again, he “only” got $1.5 M in 2008.

Think about it: times are tough for many people. (I know you think it is their fault and we should just let them all perish but I cannot accept that.) So rather than lower rates and fees for those struggling (in the hope that they will be able to continue to pay) the companies raise them - effectively ensuring those folks will default. Another example: airlines are struggling because of lower usage. What do they do? Raise rates – thereby ensuring even lower sales overall and costing their faithful customers (business travelers) more. Where did these people get their MBA’s?

Drew1369

Dont like it... dont get a credit card... I have done fine without them... personal choice my friend... its flying out the window

Are you going to apply that same logic to all of the taxes that are going to be raised?

bry623

If my rates get raised, I'll just not pay. Then when they threaten to sue I'll declare bankruptcy.

Chode

Unfortunately bry, under the bankruptcy legislation passed under Bush, you aren't going to get a free ride on your credit card debt.

Drew, once again you display that annoying sense of arrogance and entitlement that is just sort of embarrassing to read. You can't make the cognitive leap between choosing to do without a credit card, and having a card where the terms are obscure and subject to change without notice, no matter what the cardholder's performance has been. Apparently, your only criteria for deciding whether something is good or bad is "how does it affect Drew". That's pretty sad.

Drew1369

No its how it affects everyone... whatever you pull from my statements is up to you however I am talking about personal choice and responsibility... you should understand that by now...

personal choice...

So perhaps I wonder how things are going to affect me... that's how everyone thinks... what is best for me... some people might try the "I'm not selfish act" but its all BS... everyone looks out for their own interests and no one else...

even you...

Tumbleweed36

Well, I don't use a credit card for credit, just for convenience. Have not paid a dime of interest to those companies for years, since I pay mine off (no fee card from my bank) each and every month. Come on now, don't accuse me of playing the system, we all know the credit card companies make a percentage from the retailer when you purchase something, so they get some out of me in an indirect way.

There is not way to paint this except "GREED." Rest assured, this recent economy freefall didn't stop the greed in the financial sector with the million dollar bonuses while getting taxpayer money.

Fortunately, this won't harm me for now, but certainly will harm the least among us (my kids for example) who depends upon the credit card to make purchases when they don't have the cash. This is especially so of those who are just starting out with building a family or those who have had an unfortunate emergency like a transmission going bad on their car while on a tight budget.

Things like this make credit cards a necessity for those individuals. Without credit cards, the economy would suffer even more because so many could not purchase things.

While I strongly oppose government regulation in most sectors, this is an area where one has to think that regulation is a "good" thing (O.K. Yustr, I said it) to protect those who do not have the means to protect themselves from these "preditor sharks." I would think a starting point would be they can charge a certain percentage rate above the prime rate. Someone must stop this nonsense someplace.

End of rant!