Let's hope so. They mismanaged their business, They need to fail. Only pity is they stole that much more of our money with the "bailouts."

These banks are still getting bailout money AND posting record profits. What the hell is wrong with people that they're not screaming in the halls of Congress and firing all these crooked politicians and CEOs? You know...the ones in bed together? Grrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr


[edit on 27-10-2009 by ~Lucidity]

i'm sure they do make more *long term* off of extended payments than they do off of his lump sum today

maybe for some reason citi is thinking short-term dollars right now

we can speculate as to the 'why' i suppose

--edited just because--

[edit on 27-10-2009 by SecretGoldfish]

Easy.

Citi is trying to get rid of its credit card operation.

Great thread! I too received a letter from Citi last week stating that my new APR would increase to 29.99%. My account, although close to the limit, was always paid on time and I made payments far above the minimum required payment. I had been with the bank for over 12 years. This increase marked an increase of well over 200% of the current interest rate and was unacceptable. When I phoned them they explained that my only option was to "opt out" which would then close the account altogether. Left with no choice, this is exactly what I have done. I am certain my credit score is going to plummet as a result of being forced into this.

I also hope that Citi collapses on itself. In fact, I would love nothing more than to watch this whole house of cards come crashing to the floor. These banks have been nothing but thieves and pimps for far too long and I would love to see them lying in pieces! I am honestly thinking of simply defaulting outright on this as my credit is already trashed by being forced to close the account. My only incentive prior to this was to keep the account open and in good standing to protect my score. Now that's gone, so why bother!?

What I have to say is strictly my opinion. I'm not any kind of expert, although I have stayed at the Holiday Inn Express. The baking situation in general is in far worse shape than anyone could imagine. They are hanging on by a thread. In a years time, there will only be a few major banks still running. All the other banks willhave become absorbed into the biggger banks in an attempt to keep the system from imploding.

I think the reason the card companies raised the card rates to ridiculous rates is to keep people from using them. They already know their customer default rate is unsustainable to be able to stay in business. They can't just stop doing business, so next best thing, raise the rates, and hope people will just keep paying till they go bankrupt. The card companies have the government to bail them out. The consumer has no one. My solution for the consumer, you already know most of you can't pay the going rate. Just milk the card for all it's worth , possibily to keep a roof over your head, and then declare bankruptcy.

The bank easy credit terms are coming back to haunt them, and what is currently happening is going to implode soon. No one will have to wait for long. The regular guy on the street knows things can't go on much longer. You will see a major bank, such as Citi go under real soon. It's only logical, the small fish are dying in droves, and it's only time before a big fish dies. Is Citi the next one???

There is something extremely disingenuous about the stories that people are spreading online concerning credit cards and banks. It is approaching the unreal. Is it that some people are paid agents of the big banks, coming online to post stories that will influence other people's behavior?

I'll make up a name and use it for my example. Let's call the made up person ''Rodney''.

So this guy Rodney has $20,000 cash in the bank and he also has some strange desire to charge things on a credit card instead of paying cash. Rodney charges and charges until his credit card is maxed out at $20,000. The credit card bank is happy getting Rodney's $300 per month payment, and Rodney is happy keeping cash. Rodney loves cash. He keeps it in a bank account for safe keeping, but he really loves the idea of having cash. Rodney could keep all $20,000 at home held in the form of 200 $100 bills, but he doesn't feel safe with all that cash at home so he leaves it in his bank account where it earns 0.20% interest. The interest rate is paltry, but Rodney feels good about having an account with $20,000 cash that he can tap into at any moment. It just feels right to Rodney. It is safe in Rodney's mind.

Now the credit card company is charging Rodney 5% interest on his outstanding balance. Rodney's local bank is paying him 0.20% interest on his cash savings. Rodney is comfortable with this arrangement because although he is constantly losing money on interest payments to the credit card bank, and only receiving a pitiful token of interest on his cash balance at his local bank, he is delighted by the fact that he has $20,000 cash that he can put his hands on at any moment.

Years go by. Rodney keeps paying to hold cash. For years and years Rodney pays to hold cash. Then out of the blue one day the credit card bank sends Rodney a letter informing him that they are closing his credit account and they want money right away to cover his outstanding balance. This is a loan call. The credit card bank is essentially tellling Rodney that they believe he can pay it now, without the necessity of long drawn out monthly installments. This is, in fact, the opposite of what banks do. Banks want to maintain immense hoards of long drawn out monthly payment arrangements at interest. That is what they do. Banks love to accept cash deposits at 0.20% interest liability, and then loan the money out at 5.0% interest to people who.... here it comes.... people who either DO NOT HAVE lump sums of cash and need a payment plan that accommodates their immediate purchase desires or necessities in terms of their low monthly or weekly salary, OR.... people who simply are extremely desirous of holding pools of cash. Which is it? Which one of these choices fits Rodney's situation?

Rodney doesn't have a financial crisis or a need to purchase immediately and then pay later in monthly installments. Rodney doesn't lack resources. In fact, Rodney is simply satisfying his strange desire to hold cash, and at a very low rate of return. In fact, Rodney is PAYING to hold cash, and on top of that he is not even really physically holding the cash because he opts instead to keep it in the local deposit bank. It doesn't add up, folks. When you follow the money you find it just does not add up.

The story invariably continues with Rodney blowing up and telling the credit card bank where to stick it. Rodney invariably gets online and claims that he told them what to do with their lousy rotten banking operation. Why the nerve of those PROFESSIONAL bankers! How dare they charge me, and make money off interest, when I use their service to offset payment across time. I mean, I, Rodney, just want to hold some filthy cash in my hands! Who do they think they are?!! Why I'll show them. I'll just do an online bill payment immediately and send them one giant payment that will wipe out my balance for good!

Now.... instead of having $20,000 cash on one hand, and $20,000 outstanding loan balance on the other hand, Rodney has.... zero.

All Rodney wanted to do was hold some cash.

Why wouldn't the bank play along with him?

Banks play this game every day of the year plus an extra day every four years. This is what PROFESSIONAL bankers do. Rodney isn't a good banker though. In fact, he actually has a psychological motive. He has a psi-logical motivation for what he does when posting online in forums that incite banking fear.

If however Rodney was borrowing money at 5% and investing it for a return of 10% he would be doing alright by the banking code of conduct. Paying for cash and then not putting that cash to good use is a sin in the bankers' circle. Rodney seems to be suffering from some odd malady that requires a cash balance at any cost. The tale doesn't make sense.

I propose to you the banking system is alright. It is fine. There is nothing wrong with it. Sure, there are some people that play the game upside down, for whatever reason. Yet others use the banks every day for their benefit in real terms of real earnings. Participating in the banking cycle is one of the finest arts anybody can perform. But coming online to tell others that they should pay off their credit card balances and stick it to the man is just nonsense. Credit card banks WANT you to use their services. If you mess up the payment stream then you might find them not wanting to play with you anymore. But as long as you bank, they bank, and the banking system is happy and sleeps soundly at night.

Besides, who has the money lying around to simply pay off all their credit card balances in one fell swoop? Who can do that AND get called on their loan balances? That, my friend, is the proverbial ''I'm taking my ball home'' scenario, and that is simply not happening in the banking industry. Banks want to lend to good borrowers. If you have trouble then you must have played the game wrong. Don't blame that faceless Man that everybody thinks is so nasty and out to get them. And definitely don't come around claiming you got even with them by taking your ball home and stopping the game cold.

And THAT is the gist of this whole thing.

How does a bank know what YOUR situation is? They just lend money to a stranger and hope the money flows back slowly over time with interest.

How did the bank know that you had a cash reserve you were withholding from them? They didn't. Did they?

How did the bank know that you had lost your job? They didn't. Did they?

I am very curious about the events that led up to this loan call.

Nothing personal, Tex. We're two ships in the night.

It is just that I'm hearing a lot of these ''my credit card company screwed me'' stories lately.

I can't understand why a bank would raise interest rates from 5% to 20% on a customer who is steadily paying each month. Do they want to ruin the customer? That seems to go against everything the bankers do. The bankers want customers to keep paying, not call it quits and cause a write off. This is all sort of like saying to a guy if he can't pay then pay more. Can't pay? Pay more!...... oh yeah????? see ya later. instant default. instant loss. It doesn't make sense.

If a guy can pay $300 a month and that is all, and money is tight, then that is all he can pay. You can't force him to pay $600 a month. He'll tell you to go stick it. Instant and total loss. Credit card companies can't get the money from an unsecured debt. I know people that have literally just walked away from their credit card debts! They didn't file for bankruptcy, they didn't pay a lawyer, they just said screw it and threw the bills in the trash until the bills stopped coming. The banks wrote off the full amount as total default. And these are not petty amounts. I'm talking about people I know who have been irrationally squeezed to the point of failure. The bankers don't know the millions of individual situations. Bankers are making statistical decisions.

A guy can't just go out and get a better job. Change is difficult to make. Real significant change is hard. So many times people's life expectations outpace reality and their own ability to earn, and they get stuck in a bad place that makes them miserable. Some of them just call it quits and start over. I mean, if you can't pay, you can't pay. Credit rating doesn't matter at that point. If you can rationally look ahead and see your income/expense budget being stretched to the breaking point by an interest rate hike and it is going to make your life miserable then sometimes the most expedient thing to do is just call it quits. Hit the reset. Start over.

Why don't banks LOWER rates so people can pay instead of default?

In your case, you paid it off either with cash (I can understand why you didn't do it earlier if your are actually using the cash to make greater profits) or another balance transfer to another banker that is willing to hold the potato and accept the risk of getting burned (or gain the benefit of steady cash payments).

I am under the impression that most people do not miss payments. I think the real deadbeats are a small percentage. And I think the banks are making a killing.

Me, I've been getting 0% offers for years. These offers range from no fee to 3% fee. They are usually 12 month offers so the effective rate is anywhere from literally 0% to 7%. I remember in the past getting 3.99% interest offers with a 2% or 3% transfer fee. For years now I've been getting 0% interest offers with a 3% transfer fee. Just last month I flipped an account to a 0% interest and $0 fee offer for 12 months. I am not making it up. I'm not exaggerating. This is all real. I am who I say. I am working on paying down my debt from various bad decisions that are completely my fault. I don't miss payments. I don't use cash out of my stock market account because I earn money there. My trading earns money faster than I spend it on interest payments. This is getting to the point of trading on margin, trading on borrowed money. I make it work. I don't slip up.

I've gone through life like most people have.... not poor but not many resources above monthly living expenses. I've plodded along finding my way through life and building a debt until I eventually got to the point where I could reduce the debt. I do it at my pace, under my command.

I've always recognized the power of trading for ones self instead of putting money in the bank to earn 0.50% or putting money in a mutual fund to earn 10%. I'm banking my way out of money troubles.

I don't know about CITI but word is BOA is going to start charging credit card customers a monthly fee. $29.95 or something like that. It's just a random fee for people that are in good standing. Can you believe that? I just "heard' That so I can't verify it yet.

ok - citibank is too big and too powerful




[edit on 28-10-2009 by skipdogs]