The Next Crisis: Credit Cards

Speaking of credit card debt and all that...

Anyone notice the return of Lay Away depts at K-Mart????

No doubt, Wal MArt, Target etc are soon to follow. NEver thought I would see those back.

Originally posted by Rockpuck
If you default on a credit card the bank cannot seize a thing from you, not your house, not your car, nothing. It will damage your credit for 3-5 years, Bankruptcy is on your score for 7 years.

The new laws DID make it tougher to go through bankruptcy, but ultimately for those in such dire situations it should be looked at a way to start over if anything.

As someone who took this route a few years ago and only recently emerged with a clean slate, bankrupcy also has other implications which you should be aware of...

Obviously, you cannot hold any kind of bank account that has an overdraft, or cheque guarantee facility, although the banks have recently introduced a pre-pay debit card facility to avoid the risks of having to live 'cash only'.

The biggest problem that many thinking about taking this route may not be aware of is that you will be barred from taking jobs in many professions (I was forced to leave a well paying career-job as a result) and even starting up your own business, making a cash-only existence all the more difficult

[edit on 17-3-2009 by citizen smith]

My apologies to all here. I had no intentions to mislead. I somehow misinterpreted info.

respectfully

reluctantpawn

reply to post by emeraldzeus


I audited GMAC - yep, they do mortgages. All sorts of mortgages and package them and sell them to investors.

Originally posted by Make Speed Limit 45

I've never used credit in my life.

Credit used wisely can actually increase your earning ability. What a shame simple finance is not taught any more.

Credit is not the problem. The people using it wrongly is the problem.

Not using credit instead of using it wrongly is a wise idea. The true story is however, learn when and how to use it.

I still have all my cards at good rates and a large personal credit line of $50,000.00 and I'm far from rich. I can buy a house at will. Why? Because I've always used my credit wisely.

Remember that 9 out of 10 of us still have our jobs, earn the same money and pay our bills on time. This is not hurting everyone. We were not all foolish enough to put it all on the line in the Market nor did everyone abuse their credit or buy houses we knew we could not afford. As always it was a few very unwise people.

The banks could only pull their dirty tricks on people who let them. Don't take me wrong as I have sympathy for those who got blindsided. I'm also horrified for those who lost their retirement. The Banks should pay and pay dearly. They won't however. They will somehow come out of this richer. Congress and the President will make sure they do.

My sister was notified last month her Amex was canceled, I have been waiting and waiting for my citibank card to have the credit limit lowered.

Well found out last night, it was lowered - to below what I have charged - mind you I still had a $15K credit not used on it, before.

I have no doubt as I pay - the limit will be lowered and lowered, in other words, I doubt I will ever be able to use my card again.

It was the only card I had. So, no more online purchases etc.

I have been reading about people having their credit cards canceled by the companies, even though their credit is good.

The credit card "game" has begun, it is going to hurt online companies, besides companies everywhere.

Those stores always had lay-a-way. I've put things away in the past. They may have put a label over the window now, but they always had it, if you asked.

Chase are pretty much crooks themselves. While I feel bad so many felt the need to get themselves into credit card debt, I don't feel particulary bad for companies like Chase, who try everything in their power to screw over the average joe, using any excuse to jack your rates, sometimes in chunks of 18% at a time. It's almost legalized crime.

reply to post by questioningall


I noticed something you mention in your post that made the back of my mind itch...

I have been waiting and waiting for my citibank card to have the credit limit lowered. Well found out last night, it was lowered - to below what I have charged

If you have a credit card with, say, 10K charged of an available 15K credit line, and then the issuing bank reduces that available credit limit to below the amount outstanding, does that mean that in doing so, the bank have just put you over the limit and can extort huge fees and punitive interest rates?



[edit on 20-3-2009 by citizen smith]

A credit card company has never ever done anyone favors.

If this happens and they get a bailout, then I will be fit to be tied.

Being late on a judgement by a credit card that took me to court and won, with huge penalties included, they tried to garnish my bank accounts and my small town bank stopped it because they could. They also tried to tap into my little 90 year old aunts account as I have my name on it for writing checks and care taking her business. The bank said said no.

I don't know where this is all going to lead but you are right the credit card industry is going to be next.

reply to post by citizen smith


Yes that's what happened to me in essence. I tried to create an auto pay on a bill above the minimum and in doing so the CC themselves made a delay, and then hiked my long standing account into delinquent of one day and ran the interest up to 29.9%. They also began taking out a monthly finance charge of over a hundred dollars per month and now no matter how much I place on the card each month it always ends up getting the maximum penalties and the amount never goes down.

I tried to switch over to another CC which I had in good standing for years and closed just to make the right choice and they wouldnt take me back at all so I could place the high interest debt with them and get it paid off in a year.

THEY DONT WANT YOU TO PAY IT OFF!!!

They make all their money on defaults and over charges interests and penalties on saps like me...

Thing is I am currently with Wellsfargo and was with BOA, and I get the feeling they are one intity... Why else would they not let me switch?

I just paid off a 15k limit CC with BOA which had over 6000 on it. Like I say closed it just so that I could get all debt paid, then ran up my WF account to the 6k limit and just cant get it paid off and am afraid to apply to anymore to get a lower rate which I could pay off.

Any suggestions as to one that might accept me? If I could it would take one year to pay off. I dont want to go to one of those companies that do it for you as you loose your credit and I need it for travel and online purchases and emergencies...

reply to post by antar


Of course the banks don't want you to pay it off, I mean come on it is there way of generating revenue for the business. As stated before I work in the industry and I actually HELP people with their unsecured debts. But all too often people cry foul when it comes to their credit card debt, especially with regards to interest rate hikes, late payments and penalties. Folks this is all covered in your cardmember agreement that you signed for the line of credit. Maybe you should spend time reading about what your signing for before you get upset about the debts.

As far as your personal situation with WF, look for 0% offers and play the balance transfer game. Or if that is not an option transfer your balances to your lowest APR cards, and pay the debts off over time at a lowered interest rate. And every year you should be calling your credit card companies and asking for an APR reduction, they will try to raise your credit limits and talk you into that. DO NOT DO IT!! If you pay on time you are entitled to have your rates lowered, most people don't realize this.

Someone stated they had their credit line lowered, more than likely your debt to income ratio has gotten to high and you have been flagged high risk.
Even if you have never made a late payment your DIR is too high and they will lower credit lines putting you dangerously close to your credit limit. Also they will raise your interest rates and minimum payments to "protect their assets". People don't realize that your credit is being monitored at all time by the banks...