Thursday, March 13, 2008


Banks are hurting these days. People are walking away from homes they can't afford and banks are stuck holding the keys to houses no one will buy. 6 out of the 10 buildings on my block have For Sale signs out front. Won't be long before the bank forecloses on those. One thing is certain in this mess - the banks are going to get their money back somehow. First they lent obscene amounts of money to people who weren't qualified to pay it back, then they jammed up the rates and demanded the money back, and now that they're stuck with a bunch of overvalued real estate, they're heaping the burden back on consumers.

Below is the latest word from the Consumers Union. It's a good idea to check your credit card rates on your statements, as they do change. Issuing banks have been hiking them up quietly in an effort to stop the bleeding. If you don't like what you read, I encourage you to do something about it!


Bank of America recently announced interest rate increases, even for responsible card customers—some people reported new rates as high as 28%! And the bank didn't make it easy to object.

To decline the rate hike, the bank required card holders to write a letter agreeing to stop using the card and pay off the existing balance at the old rate, according to news reports. They couldn't telephone, nor did Bank of America provide a form or a return envelope to help meet the short deadline. If the company didn't get a quick response, rates would automatically rise.

Bank of America is not the only bank to hit card holders with high rates and fees. Banks get to raise your interest rates, as well as the fees they charge for most services, because fine print clauses in your credit card contracts allow it. They don't even have to tell you why they did it.

Tell Congress to protect card holders from unfair rate hikes, exorbitant penalty fees and other fine print "gotchas."

As the economy softens, some Wall Street analysts believe that big banks want to make up their investment losses by raising rates to good credit card customers.

A bill proposed in Congress would help rein in that practice and limit other "gotchas." The bill would protect cardholders against arbitrary interest rate increases; hidden interest charges, due date traps and more.

This bill is long past due! Tell your lawmakers that you support the Cardholders' Bill of Rights. Do something about it!

No comments: