Ray From Cleveland
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- Aug 16, 2015
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Credit card rates are higher today because of more demand for credit. When Trump took office the average credit card rate was 12.5%. As of last Aug. it had risen to 16.9%. Credit card companies raise their rates to whatever the market will bear and today there is strong demand for credit. And it's all because people can not control their spending. You would think that as unemployment falls and more people are working, their would be less demand for credit and rates would fall. Not so, it's the very opposite. Pay a man an extra dollar and he will spend $1.10. Pay him an extra $2 and he will spend $2.25.It's why so many people use credit cards. If someone fraudulently uses your credit card, you are at most responsible for $50. If you report it within 90 days the amount is $0. Using cash today makes it much more likely that you will be robbed and when they take money off a person, the money lost is often the least of their worries. And when you're abroad, a credit card is the way to go in most countries. You don't have to worry about having the right change or changing money when you change countries plus the fees the credit card company charges are often no more than what the money changers charge and it's hell of a lot more convenient.The only people I see using cash are old people who can't even tell if they got the right change.Hell, a Walmart worker can't make change without using the calculator on the cash register.
The old people know if they got the right change. The old people also know you greatly reduce identity theft by using cash.
Credit cards are great if you can manage your spending to match your income. All the nice features of credit cards are paid for by the suckers who carry a balance. If you don't run a balance, the card cost you nothing unless you have some type of rewards card.
Wrong. I have one credit card where I have a balance, and I pay nothing in interest. All of my credit card offers are 0% interest for a year or year and a half. Balance transfers are where you pay the money at.
Before DumBama Fd up the banking industry, I also used to get no transfer fees as well. But DumBama instituted regulations on credit card companies that limited their ability to increase interest rates, and late fee penalties.
The banks made a ton of money from those irresponsible people, and had to make that money up somewhere, so they now penalize responsible borrowers instead. Prior to that commie, banks rewarded good customers with no interest or transfer fees.
A good political move by DumBama, because most irresponsible people vote Democrat, and most responsible people vote Republican. So what he did was switch the penalties to likely Republican voters.
There is simply no truth to that. People use credit cards today they way they always have.
No, what happened with the credit card industry is the magic Mulatto had to stick his two ears into it. Banks lost a lot of money by not being able to assess fines and higher interest rates to irresponsible borrowers who didn't make minimum payments on time, or no payments at all.
The impact of the Card Act
The Card Act reduced “gotcha” credit card fees by more than $16 billion in the years after it passed, according to estimates from the Consumer Financial Protection Bureau, the agency tasked with enforcing the law. In a 2015 report, the bureau noted some positive changes for consumers since the law was implemented:
- Average late fees assessed are now $27, down from $35 before the Card Act.
- Over-limit fees have mostly disappeared.
- Issuers rarely “reprice” accounts anymore — that is, they generally don’t increase interest rates on both new and existing balances because of a cardholder’s infraction on one account or another.
The Credit Card Act of 2009: What It Does and Doesn't Do - NerdWallet