Credit Card Rate hikes

[Turbineguy]

I've been getting a bunch of change notices from my credit card suppliers. No problem says I, I pay off my cards every month. Rates are going up. 22+ percent now. So is there anything I want to buy worth paying an additional 22 percent for? Default rate will be 29%. Default. 29%. That should make it easier for people to catch up!

If you miss or are late for a payment, don't even bother looking for a fucking postage stamp. Go straight for bankruptcy.

It's one thing to be greedy. It's another to be greedy, stupid and self destructive.

One of my friends says it rather nicely:

"A good deal of the trouble we are having nowadays is due to lack of visibility, both in traditional markets and in the newer credit default swaps. Bankers and brokerages still do not want to change the rules on these trading vehicles so people and companies can see just what is going on and what sort of risk an establishment is taking. Right now, I don’t think the rules will change. They would bring down the country…no, make that the world economy before we’d see a change. With hedge funds skirting the rules by trading outside US stocks outside US borders, any change would need to be world wide."

Credit card defaults pushed by high interest rates (remember: credit cards also charge a fee on every transaction) will send us further down the spiral.

[MrMonk]

1. You got notices?

My CC companies just change the rates and let me find out on the next bill.
The last change notice that I received was to announce a $70 annual fee to "defray" their costs for providing the card. Apparently, it was to my advantage to pay extra to have them send me bills. (I also pay in full monthly.)

[Warpy]

2. The goosed up interest rates are a way to hike minimum payments

and the credit card companies are scrambling to get all the money they can now because they know the gravy train is coming to a halt very soon. They know they'd better sock away all the funds they can get their hands on in order to stay solvent, at all.

The next thing we'll see is the frozen credit card, credit cut off at the outstanding balance.

[customerserviceguy]

3. They're getting desperate

I'm sure that defaults are running rampant, and will continue to do so. What does your average banker do in such a situation? Squeeze harder on the oranges that still have juice in them.

Other than annual fees, they can't charge you for them if you don't use them. And if that happens, I'll bid mine adios. It does hurt your credit slightly to cancel cards, but my rating is pretty high right now, I'd suffer the loss of a few points for a year or so to avoid shoveling money at them for nothing.

[flstci]

4. I was sent a notice from Capital One over a year ago saying

they were hiking the interest to 13% from 5.9%. I declined. I transferred the balance I was carrying to another card that had 4.9% and it has been the same since then.

After canceling the card Capital One sent me several offers going back to the 5.9%, I throw them away. They lost a customer. I called them when the rate hike came in and they wouldn't play ball so fuck em.

[Zorra]

5. The People's bailout/economic stimulus plan:

If everyone stopped paying off credit cards, credit card companies could not do a damn thing about it. They'd totally crash, as they deserve to.

This is one way folks could initiate their own economic stimulus package - think of all the extra money people would have if they did not have to pay off credit cards. They'd use the extra money to buy stuff, and all that extra cash floating around would be reviving the economy.