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Bank of America jumped my rate from 9.9 to 24% in one month with no explanation and with no notification--I only happened to look at the rate section on my bill. When I called immediately to complain, they put me on hold for 20 minutes before they knew what it was about, then another 25 minutes after they were redirecting me. They claimed that it was in the fine print that they could change their rate at any time. This did not follow errant or delinquent behavior on my account--no late payment, no going over my limit. As far as I can tell, Bank of America is a complete bully, and greedy, as well as devious. Before this incident, they had changed the whole format of the bill, saying it was for better readability. But it was clearly worse--grey on grey lettering, smaller print. I couldn't easily see my due date or minimum payment. Capital One also hiked my "fixed for life" rate from 9.9 to 23%.
It's up to Washington to make sure that the banks can't constantly increase the squeeze on the working class, and the working middle class. The free market run rampant leaves democracy far behind. Congress has a chance to negotiate btwn capitalism and democracy.
Marvin Weatherspoon, mentioned in the article, took out a $12,000 loan for home repair bills in 2000. At the time, the rate on his BoA card was $4.25%. Today, it's nearly 25%. Though he's made the minimum payment each month, he's paid down only $800 of the loan's principal in eight years. (This is a guy who, after working for 28 years at the Chicago Convention Center, makes $17.26 an hour.)
The banks and the Republicans want regulators -- not Congress -- to make the reforms, though historically the Federal Reserve regulation (Reg Z) they're referring to has simply dictated what disclosures card companies must make to customers. As New York Rep. Gary Ackerman (D) asked yesterday: What good is disclosure "if all it does is tell you how many ways the card will screw you?"
Advocates recommend that consumers relate any horror stories to their congress members. Consumers Union has a spot on its Web site to log complaints, as does the Service Employees International Union. Another spot is Consumer Action (www.consumer-action.org), which is the group that brought Christy Mylar Smith to Washington.
I have had excellent credit for the past twenty years. In fact the credit card companies, American Experess, JP Morgan Chase, and Bank of America have sent me letters extending my credit limits. And then it all came to a crashing halt!
We missed a house payment due to a computer glitch at our home mortgage bank. The new escrow amount was finally straighten out, 8 months later with all penalities and fees removed. MidWestern Financial Credit Union Bank of Ann Arbor refused to take the one late payment off our record. They would not admit any culpibility. J P Morgan Chase and Bank of America jacked up my credit card rates under the "Universal Credit Default" clause which allows on late payment from a spouse with joint ownership of an asset such as a mortgage to be used to raise all credit cards to the maximum of 24.95% plus penalities yielding 32% total. (Michigan)
After months of discussions and letter writing to the credit card report services and to Bank of America and JP Morgan Chase settlement finally evolved. Bank of America agreed with me and returned my rate to its original lower amount. The Credit reporting Services agreed with me and took the blips off my record. On the other hand, J P Morgan Chase sued me for the full amount pluse $2,000 in additioanl fees. We settled one week before trial with J P Morgan taking $6,000 less than the original amount owed. J P Morgan Chase wrote off the entire $25,000, that's a savings of 35% from their corporate taxes, the lawyers got there juicy cut, and I got a lesson in legalized loan sharking, outrageous usury, and unethical behavior. OF COURSE it will take 3 years to repair my credit. Our congress and the President imposed these new credit card rules in 2005 as part of the Bankrupcy Laws Reform. (some reform?) In my opinion, it is unconstitutional at both the State and Federal levels, but this takes thousands dollars to buy the lawyers necessary to right the ship of justice. Signed: "Discusted Senior Citizen"
http://www.occ.treas.gov
I did a search and came up with this link:
http://www.pirg.org/consumer/bankrupt/bankrupt2...
On the Senate side, Sen. Chris Dodd is very interested in these issues as the Chairman of the Banking Committee.
USPIRG and the Student PIRGs have teamed up with the SEIU to discuss credit card abuses at a Town Hall meeting with US Congressman Barney Frank and Massachusetts Attorney General Martha Coakley. Share your story of abusive credit card practices and sign up to attend the meeting, which will be held on March 19th, at 9:00 am, at the SEIU Local 615, 26 West Street, 3rd Floor, Boston, MA 02111.
Permanent Subcommittee on Investigations
http://hsgac.senate.gov/index.cfm?Fuseaction=He...
Title: Credit Card Practices: Fees, Interest Rates, and Grace Periods
Date: 3/7/07
Time (EST): 10:00 AM
Place: Dirksen Senate Office Building, Rm. 342
The Permanent Subcommittee on Investigations has scheduled a hearing entitled, "Credit Card Practices: Fees, Interest Rates, and Grace Periods." It is the first of several Subcommittee hearings that will examine a variety of credit card practices that raise concerns. This hearing will focus on how credit card issuers apply interest rates and fees to consumer accounts. It will examine, for example, how credit card issuers select and apply interest rates and, for consumers carrying a balance forward, eliminate grace periods for repaid debts. It will also analyze high fees charged for late payments, over-the-limit charges, and other matters, including how those fees are assessed, how they add to interest costs, and how they contribute to consumer debt. In addition, the hearing will examine an industry practice requiring consumer payments to be applied first to balances with the lowest interest rates instead of to balances with the highest interest rates. The hearing will draw, in part, from a September 2006 GAO report detailing the finance charges, fees, and disclosure practices associated with 28 popular credit cards.
Unfortunately, it appears the Democrats on this committee are just as complicit in this as the Republicans. Either that or they are just completely spineless.
You know, like with the impeachment thing.....
http://www.washingtonindependent.com/view/quest...
1. How can the Republican minority impose this waiver requirement over the objection of the Democratic majority?
2. Did the Repubs also insist that the credit card issuers sign similar waivers, making the details of their financial condition and interest rate decisions public for all to see and comment on.
I'm pretty sure the answer to 2 is a resounding "no." What the hell is the answer to 1?
Compare credit cards with Australia