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SATURDAY, NOVEMBER 21, 2009
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22

Credit Cards Rates Jump Ahead of New Regulations

Companies add fees and cut limits in blind cash grab

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(Newser) – If your credit card bill just exploded, it wasn’t an accident. Card issuers have been jacking up rates to historic highs—in excess of 30%—cutting limits, and adding new fees in an effort to squeeze money out of customers before new federal regulations kick in Feb. 22. The new rules will prevent them from retroactively raising interest rates and fees on existing balances the way they’re doing right now.

“I might have been better off going to the mafia,” laments one customer, whose rate has hit 29.99%. Companies were supposed to use the 9-month lead in period to clean up their act, but Barney Frank says they’re abusing it. “I didn’t think they would be as blatant as they were,” the House financial services chairman tells the Boston Globe. “This is really just a way for them to make more money.”

Barney Frank can't believe how blatantly companies have abused the extra time the government gave them.
Barney Frank can't believe how blatantly companies have abused the extra time the government gave them.   (AP Photo/Harry Hamburg)
Credit card companies are scrambling to grab as much of their customers' cash as they can.
Credit card companies are scrambling to grab as much of their customers' cash as they can.   (Shutterstock)
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22 comments
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DJM420
Nov 6, 09 1:50 PM CST
lol Reply
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0
IN RESPONSE:
tomodachi
Nov 6, 09 2:52 PM CST
It’s time to show congress that the US voting taxpayer is not an unlimited source of money for them and the industries they sleep with. It’s time we turn our backs to the people who are thinking this. I strongly urge every voting taxpayer to immediately re-register as something OTHER THAN republican or democrat… and stop voting for any of them… and convince everybody they know to do the same… and kill the 2 party stranglehold they have on the US.
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+5
IN RESPONSE:
IndependentThinker
Nov 6, 09 3:49 PM CST
If only they would listen tomodachi =(
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+3
IN RESPONSE:
Netstorm2k9
Nov 6, 09 4:05 PM CST
I utterly concur, tom. So so much. So very very very fucking much.
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+1
JoeQ
Nov 6, 09 1:58 PM CST
I just had one card I hardly ever use drop my credit limit from $25k to $10k, for absolutely no reason at all. They claim it does not affect my credit score, but I just bet it does. The calculation of credit score is based on the ratio of outstanding debt to total credit limit. If the credit limit goes down (in the denominator) then the ratio goes up. That makes it look like my debt level jumped (in the numerator). Then they can lower my credit rating slightly and use it as an excuse to raise the interest rate they offer me in the future. I rarely borrow against my credit and always pay it off immediately, but they are bastards for doing this kind of thing anyway. Gee, I wonder what happened to all the trillions in stimulus money that the feds gave the banks to keep credit flowing? Reply
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+8

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