Credit Card Company Rate Hikes - Part 2

(or IMHO..)

I just wrote CNBC about credit card company rate hikes. Here's what I wrote:

I’m sending this email to several of the CNBC shows I watch.  As an avid CNBC watcher, I am concerned by the seeming inability of some commentators to grasp the real implications of the credit card company rate hikes.  Obviously, these commentators are fortunate enough not to carry balances on their credit cards.  Most consumers are not so fortunate. 

The issue regarding credit card rate hikes is not whether debtors deserve relief; the issue concerns predatory lending practices.  These consumers are being affected by credit card companies who

·         make small adjustments to due dates in an attempt to trap consumers into default,

·         unilaterally change contract terms because of their “high cost of doing business,”

·         convert low fixed fee cards to high variable-rate cards, and

·         hit consumers with Universal Default Charges for any excuse possible.

Credit card representatives are trying to justify the increase by claiming that “everyone is doing it.”  Personally this sounds more like illegal collusion and poor customer relations decisions than good credit management decisions. 

Most consumers are managing their credit, but they are carrying a balance and can’t just pay off the balance – and the rate increase is applied retroactively.  In some cases, rates are increasing by 12% or more.  The consumers being most affected have made monthly payments on time, often paying more than the minimum balance.  Their credit card balances may be the results of circumstances not entirely within their control, but they have been fiscally responsible in meeting their obligations.  Rather than gladly accept the monthly revenue derived from these payments, credit card companies are pushing this revenue source into default. 

Remember the bill passed in 2005 without fanfare in the dead of night?  Bankruptcy laws were tightened and minimum credit card payments were increased.  Witness the implications.  A few years ago, credit card companies miraculously ceased such predatory lending practices just before being called to task by Congress, claiming such decisions were a mistake and that they cared about their cardholders.  Obviously they “cared” just long enough for Congress and the consumer to cough and turn their heads. 

Citizens of the United States have a constitutional right to exercise their freedom of speech in an orderly, legitimate fashion. Let's go make some noise.