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Credit Card industry "threatening" responsible users with charges

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I only use credit cards as much as I do because I think it's safer to pay with them. I've read at many places that if the fraudulent charges are made with your debit cards, the hassle you have to go through with your bank to get your money back is immense. On the other hand, with credit cards in that case, you are just one phone call away to block the charges and no money is ever being taken from your bank account. Other than that, I use CCs exactly the same I use debit. I pay them off in full that same week always.

It also helps that with them you build the credit score of course.

If they hike things up with these yearly fees and whatnot though, I don't know if any of that will be worth it.
 
Deku said:
that's PRECISELY my point. They aren't a monopoly but they act like they are.
Click to expand...

Your logic. It escapes me.

Dealing with your edits, it's logical when costs increase to attempt to lean out other areas. The Obama administration is going to squeeze their margins, so the credit card companies are going to attempt to regain those margins by making it less likely their least profitable customers will continue using their services.

They are raising prices and customers will likely go elsewhere for liquidity as a result.
 
eznark said:
Your logic. It escapes me.
Click to expand...
Logic is sound. The little detail that monopoly profits does not require a monoply escaped you.

the term monopoly profits only imply profits in excess of what you would expect in perfectly competitive markets. you also see those profits in industries with multiple players that COLLUDE. as well as oligopolies and cartels.

macro economics 101.
 
Yeah, I use my credit card as a debit card that I earn 1.5% cash back, 30 days average delayed payment, and as an avenue to dispute purchases.

If I lost any of that, I'd just move to using an actual debit card and spare myself the hassle.
 
Deku said:
Logic is sound. The little detail that monopoly profits does not require a monoply escaped you.

the term monopoly profits only imply profits in excess of what you would expect in perfectly competitive markets. you also see those profits in industries with multiple players that COLLUDE. as well as oligopolies and cartels.

macro economics 101.
Click to expand...

You can argue limited deadweight loss but extrapolating that into the industry being monopolistic is a leap you're better off not taking.

You apparently took a very specific form of "macro" 101. One could almost call it micro-scopic in its focus..
 
eznark said:
You can argue limited deadweight loss but extrapolating that into the industry being monopolistic is a leap you're better off not taking.
Click to expand...
meh, i only implied they are making excessive profits and will continue to do so under their new plan to rape consumers.

if that's the case, might as well have a government appoint a real monopoly where the risk of bad loans can actually be spread out in the population and not obfuscated by CC companies picking and choosing their customers.

it can be argued this is one industry where a natural monopoly is preferred over many competing entities.
 
Deku said:
meh, i only implied they are making excessive profits and will continue to do so under their new plan to rape consumers.

if that's the case, might as well have a government appoint a real monopoly
Click to expand...

Define excessive profits. If there is limited dead weight loss why should anyone care if there is something you're calling "excessive" profits?

it can be argued this is one industry where a natural monopoly is preferred over many competing entities.
Click to expand...

The reason responsible users are getting fucked is because of government intervention. Yeah, evil credit card companies indeed.
 
Some credit cards still offer refund and price protection, so they'd still be of some use. Might as well pay a small bit of immediate interest on that new computer with your Amex for an extra year of protection. There's also charge back protection. You don't get that with debit cards in general.

Still, I hate these moves, too, and I utilize reward credit cards all the time. It's how I got my flight and hotel to Singapore this summer for free (well, $40 in fees).
 
i still say its a credit card temper tantrum, because the "deadbeats" that mostly dont give them any money will just cancel their credit cards and... never give them any money

its a publicity thing at a very ill-conceived time. Give the baby his bottle and make him shut up
 
Fine with me. Getting a credit card is one of the worst decisions I've ever made, financially. Once I'm through school and pay off my student debts and whatnot, I will cease to use my card outside of emergencies.
 
gcubed said:
i still say its a credit card temper tantrum, because the "deadbeats" that mostly dont give them any money will just cancel their credit cards and... never give them any money

its a publicity thing at a very ill-conceived time. Give the baby his bottle and make him shut up
Click to expand...

I agree. It's a chance to shed unprofitable customers. The regulation is a bit of a flak jacket. It makes sense to me. I imagine the maintenance and servicing and rewards payouts of the "deadbeats" offset a lot of the fees accrued so the industry has been trying to figure out a way to disencentivize no balance carriers for years. This allows em to do it and provides (limited) cover in the process.
 
Deku said:
that's PRECISELY my point. They aren't a monopoly but they act like they are.
you only see the kind of thuggish profit queezing from monopolies , not in perfectly competitive markets.
Click to expand...
Um. They pay us to use their credit cards. Perhaps you didn't notice this?

fyi , monopoly profits do not require the existance of a monopoly.

the term only implies once a company reaches monopoly status they can always charge more for the same crap.
Click to expand...
I think you're conflating monopolies and inelastic demand.

If you're not, then I have no idea what you're talking about.
 
Cyan said:
Um. They pay us to use their credit cards. Perhaps you didn't notice this?


I think you're conflating monopolies and inelastic demand.

If you're not, then I have no idea what you're talking about.
Click to expand...

Whether demand is sufficiently inelastic in the deadbeat sector is arguable, but I would argue the demand for debt on credit card is pretty inelastic.or they cant afford to PAY a handful of preferred customers to use their cards and also make a profit.

They are robbing Paul , pocketing a hefty amount and danging pennies to get Tim to sign up. And the tims they sign up all have a chance of becoming debtors who pay them hefty interest rates.
 
TheExodu5 said:
Fine with me. Getting a credit card is one of the worst decisions I've ever made, financially. Once I'm through school and pay off my student debts and whatnot, I will cease to use my card outside of emergencies.
Click to expand...
But it's been one of the best for me. If you're able to use them responsibly, they're a wonderful thing. If we had to pay interest immediately though, there's obviously going to be no reason to continue to use them. The overhead on a complete industry paradigm shift seems like it would be rather substantial... I just can't them doing this across the board. I'd obviously cancel my cards though if they no longer offered notable rewards programs.

I opted out and no longer get the CC junk -- it does work for those curious.
 
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...

huge win for consumers (loss for CC companies) in bold
 
Wow! If they get rid of the already too-short grace periods (wtf is with this 22-day bullshit?) then I'll just make daily card payments, or run a surplus and use my card like a prepaid. I don't have to pay interest if I don't want to, there are options. I just think this is the wrong way of tackling the issue, and will screw poor people more. I use one card b/c they changed the rewards plan recently so the points no longer expire. They better not go back and change that or I will certainly stop using their card. PEACE.

EDIT: And CNN just announced the CC bill that passed. We win...I guess.
 
Pimpwerx said:
Wow! If they get rid of the already too-short grace periods (wtf is with this 22-day bullshit?) then I'll just make daily card payments, or run a surplus and use my card like a prepaid. I don't have to pay interest if I don't want to, there are options. I just think this is the wrong way of tackling the issue, and will screw poor people more. I use one card b/c they changed the rewards plan recently so the points no longer expire. They better not go back and change that or I will certainly stop using their card. PEACE.

EDIT: And CNN just announced the CC bill that passed. We win...I guess.
Click to expand...

dont forget, most places only allow you to make 2 payments or so a billing cycle, and then some companies also dont allow you to pay more then your balance online. :)
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...

All of these sounds reasonable.
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...


GLAD TO READ THIS!
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...
Sorry, but those saying these are a good thing are not seeing the whole picture. This is very bad for those that use credit responsibly. As stated already in the thread, rewards are going to end, yearly fees will exist for every card, and then the possibility of interest being instituted as soon as you charge? Horrible. The credit card companies want their money, so now instead of users who pay late and carry a balance subsidizing rewards and cash back for users who are responsible, it will be the other way around. Forget that, I'm moving to cash and debit if all this happens.
 
negreenfield said:
Sorry, but those saying these are a good thing are not seeing the whole picture. This is very bad for those that use credit responsibly. As stated already in the thread, rewards are going to end, yearly fees will exist for every card, and then the possibility of interest being instituted as soon as you charge? Horrible. The credit card companies want their money, so now instead of users who pay late and carry a balance subsidizing rewards and cash back for users who are responsible, it will be the other way around. Forget that, I'm moving to cash and debit if all this happens.
Click to expand...

i disagree completely. all these doomsday scenarios were the credit card companies trying to drum up opposition to the legislation.
 
gcubed said:
dont forget, most places only allow you to make 2 payments or so a billing cycle, and then some companies also dont allow you to pay more then your balance online. :)
Click to expand...
Wha? I have a recurring payment set for my main card (just automatically pays $100 every week) and then pay off larger chunks as necessary. What card in the world limits the number of times you can pay ion it? That sounds ludicrous.
 
gcubed said:
i disagree completely. all these doomsday scenarios were the credit card companies trying to drum up opposition to the legislation.
Click to expand...
I agree that what the companies will do is being overblown but the fact remains the rewards will suffer and credit cards will be less desirable to use.

I'm sorry, all of these terms are spelled out for people when they sign up for the cards, if folks are upset about it then they shouldn't have signed up for the cards.
 
If the credit card companies do that, I'll open up an account with a local credit union and borrow a line of credit from them. Then, I'll risk a slight decrease in my credit score just to close my credit card with the bank. I don't have any major expenses on my credit card so I pay it off frequently. I can live without a credit card if I want to.
 
Didn't the Obama Administration say they were going to put an end overly harsh penalties from credit card companies? Like yesterday?
 
NetMapel said:
If the credit card companies do that, I'll open up an account with a local credit union and borrow a line of credit from them. Then, I'll risk a slight decrease in my credit score just to close my credit card with the bank. I don't have any major expenses on my credit card so I pay it off frequently. I can live without a credit card if I want to.
Click to expand...

Sorry, that isn't an option. Credit cards have a monopoly on lines of credit.
 
Meier said:
Wha? I have a recurring payment set for my main card (just automatically pays $100 every week) and then pay off larger chunks as necessary. What card in the world limits the number of times you can pay ion it? That sounds ludicrous.
Click to expand...

i cant remember which of mine has it, but i do have one that only allows 3 online payments were cycle
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...
These mostly sound really good. We'll see if the effects on the rest of us are as bad as the CC companies were moaning about.
 
Don't these banks realize that those who pay off their balances every month don't need a credit card? If they add all these charges people will just stop using them. They would also give up boatloads of money from transaction fees. I use my credit card for every purchase I can. It lets me keep track of where I am spending my money. I also get some nice rewards.

My guess is that those who are responsible with their cards use it a lot more, either cause they have more money, or manage it better. While banks may be losing out on finance charges, late fees, and delinquency rates, they are making out like bandits on transaction fees.
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
    [*] Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...
Wow...I like this one.
 
eznark said:
Sorry, that isn't an option. Credit cards have a monopoly on lines of credit.
Click to expand...
angry.gif
What ? RAGE RAGE !!!
 
Meier said:
Wha? I have a recurring payment set for my main card (just automatically pays $100 every week) and then pay off larger chunks as necessary. What card in the world limits the number of times you can pay ion it? That sounds ludicrous.
Click to expand...

afaik, pretty much any time money is transferred someone makes money.

So everytime you pay your credit card with your bank account, your bank makes money. Everytime you charge something at store or online, your charge card makes themselves money (amex at a higher %).

That's why in that Pirate Bay case where they have been ordered to pay $1 million to some company, they are asking people to send payments in $1 increments, so the place getting paid actually has to pay $2 million to receive $1 million.
 
I'm all for this. I've been needing a reason to stop using my credit card as a debit card, and this could be it.

The government still needs to get out of the business of credit card companies, though. People are already dumb as shit and need everything spelled out to them in big, bright letters. The government "protecting consumers" (which is a load of bull to begin with) will only further damage the poor brains of the average consumer, who gets confused by relatively simple contractual agreements. Stop "protecting" people so that they can protect themselves to stop the cycle of dumbfuckery.

The government should be more about the business of ensuring credit-card companies (and the consumers, equally) are bound to existing contracts, not getting into the contents of how contracts are written and what clauses can be put in them.
 
KRS7 said:
Don't these banks realize that those who pay off their balances every month don't need a credit card? If they add all these charges people will just stop using them. They would also give up boatloads of money from transaction fees. I use my credit card for every purchase I can. It lets me keep track of where I am spending my money. I also get some nice rewards.

My guess is that those who are responsible with their cards use it a lot more, either cause they have more money, or manage it better. While banks may be losing out on finance charges, late fees, and delinquency rates, they are making out like bandits on transaction fees.
Click to expand...
Pretty much. Don't they take like a 3% rip on all transactions? I use my CC for everything too, but I've got lots of options and little actual need to borrow in the future. This isn't the right answer for the current economic climate. PEACE.
 
Credit card companies give you a line of revolving credit, much like a line of equity on a house. This makes them look like a bank that penalizes customers for paying off their equity line/mortgage faster than they should.

Make them a bank already.
 
That's really bad but it will totally work.

People will simply bend over. I have ZERO faith in you all.

Oh well, this will incitate me in not using my cards even more. What's ridiculous thought is that we will increase how credit score by PAYING? I might as well send them a check directly so they increase my reputation...

.
 
argon said:
Credit card bill just passed the Senate, and will likely pass the House. Here's an overview:

  • Changes in card terms must be disclosed 45 days before taking effect.
  • No retroactive rate increase on balances unless payer is 60 days late.
  • Bills must be sent 21 days before due date.
  • Consumers under 21 must be cosigned by a parent or show proof of ability to repay debt
  • Principal payments must be applied to the highest rate balances first.
  • Teaser rates must last at least 6 months, and rates cannot be raised for the first year after an account is opened.
  • Over-limit fees must be explicitly agreed upon by consumer.
  • Payment fees (electronic, mail, phone, etc) cannot be imposed unless it is for expedited service.
Click to expand...

I'm not 21...will my card be grandfathered in?
 
Good job Congress. Thanks for fucking things up for the people that actually have good credit.

FUCK


fuck
 
negreenfield said:
Sorry, but those saying these are a good thing are not seeing the whole picture. This is very bad for those that use credit responsibly. As stated already in the thread, rewards are going to end, yearly fees will exist for every card, and then the possibility of interest being instituted as soon as you charge? Horrible. The credit card companies want their money, so now instead of users who pay late and carry a balance subsidizing rewards and cash back for users who are responsible, it will be the other way around. Forget that, I'm moving to cash and debit if all this happens.
Click to expand...


That's the point!
 
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