Minimum Credit Card Payments to double in next few months

[DS1]

http://news.yahoo.com/news?tmpl=story&cid=401&e=2&u=/wyff/20050718/lo_wyff/2831815

If you have a high balance on your credit cards, you may be in for a shock when the next bill comes.

Within the next month, Bank of America, MBNA and Citigroup will raise minimum monthly payments on their cards from 2 percent of the balance to up to 4 percent, not including interest. Other card issuers are expected to make similar changes by the end of the year.

The good news is that the time it takes to pay off a balance will take much less time -- if you have the money to make the minimum payments.

"On the good side of that, they will get out of debt faster, but on the down side, it's gonna be a squeeze," Greg Burgess, of Compass of Carolina, told WYFF News 4's Tim Waller.


Yay! = :sarcasm:

Glad I don't have any Credit Cards = not :sarcasm:

[Dora]

1. This will break us.

I'm not kidding. This could drive us into bankruptcy.

[DS1]

3. Sorry

:pals:

[Dora]

15. Thanks.

Needed that.

[expatriot]

9. Sorry to hear it....

....but if a doubling of your minimum payment puts you in bankruptcy, yit was just a matter of time anyway.

this is supposed to help consumers so they actually have to pay off some of their debts instead of getting loansharked by the credit card companies.

[jedicord]

10. Same here.

I know, I know be careful with credit cards. That's easy to say until a wage earner loses his/her job and uses them to cover necessary expenses until the money (which isn't as much as it was) starts coming in again.

Did I also mention medical bills, especially prescriptions added to the mix?

Back when Clinton was President we had 0 balances, by the way.

[Selatius]

13. I feel sorry for you.

Especially after the damn federal government just made it harder for ordinary folks to declare bankruptcy in troubled times.

[HornBuckler]

14. File NOW

If you are in this situation DO IT NOW - All of you! That new BK law will screw you out of ever being able to file come the new year. File now. Do it if you must, otherwise your screwed.

(BTW I have extensive knowledge in BK cases/law - if you need any advice at all just PM me) - that goes for everyone - we are in this together.

[wicket]

17. I agree completely

The rules will get really harsh in a few months- if this is going to drive them over the edge, they should definitely file now.

[HornBuckler]

26. Agreed

I cannot agree more - Those folks who are having trouble with 2% are going to be screwed at 4% - FILE NOW

[Eloriel]

50. HornBuckler -- an idea

How 'bout starting a big ole honkin' thread all about the new Bankruptcy Bill -- when it goes into effect, the provisions esp. as compared with current law, etc. Or links to good info.

You would be doing SUCH a tremendous service for your fellow DUers.

How 'bout it? Pretty please?

[LaPera]

23. Your not a corporation, your just one of the workers, you can't file...

and protect yourself and your lifelong accumulation of assets (as corporations can).

Unless you want to give up everything you own and that still won't be enough...

The credit cards company's (corporate banks) pushed for the new bankruptcy laws and now they want their money...Knowning full well, there's nowhere people can now turn to for relief, they don't give a fuck...pay us now or sell everything you own, then give us the money.

Yes, today's fascist corporate America...And who were all those people who said they hated unions, and that corporate management would take care of them?

They drank the republican Kool-aid and are now waking up to reality and the truth of what republican ideology is all about.

[mike_c]

36. this is not true...

...at least not for most people-- certainly unlikely for most people in this situation. I've just come out of Chapter 7 bankruptcy. I did not lose ANYTHING except my unsecured debts (of course, I don't own much that anyone would want). Now I can live within my means for the first time in 20 years-- much of that debt still dated from my college days-- and I'm saving money every month.

[Eloriel]

52. That's the current law, not the new laws.

And is Chapter 7 what most individuals file under?

[mike_c]

59. you're right-- I meant under the current law...

...which people still have a few months to file under. My attorney says he's REALLY BUSY right now. Yeah, after the first of the year it will be much more difficult.

on edit-- yes, Chapter 7 or Chapter 13, depending on whether they want a full discharge or not.

[davekriss]

97. It is true under the new law...

...that most filers will be forced away from Chapter 7 to Chapter 13. Under Chapter 13 they will be forced by the court to accept a payment plan that puts them some meager multiple over the poverty level for their family size. Krugman calls it "debt peonage". We're surfing to serfdom, we are, it's really coming.

[Eloriel]

48. I think, thanks to the new Bankruptcy law so favorable to the

credit card companies, that that is precisely the plan.

Edited: If it's any consolation, you won't be alone (we may be right behind you, unless we elbow in front of you).

[Fescue4u]

73. Then file now.

Seriously.

If you are that close to bk, then you should go ahead and file now. Virtually everyone who files (including myself), say they had wished they had done it earlier, sometimes years earlier.

Most people hold on thinking that bk is the worst possible place to be. That is not true. The worse possible place to be is at the BRINK of filing BK. Once you file, the debt problem is over and you start fresh.

This advice would hold even IF the changes in law were not coming.

Given the fact you won't be ABLE to file in a few months (and this announcement is NOT a coincidence), anyone who thinks they may need to file in the next year, needs to file right now.

best of luck

[ArkDem]

80. Be cautious, don't take advice from just anyone. Avoid advice

from posters who don't know the difference between pronouns and contractions.

[methinks2]

96. than just do it, I held on for years before I did it

I ran up a lot of charges when my husband was going through cancer treatments. It seemed like I could never get ahead and finally just gave up. It's such a relief to get it over with. It amazing how many are doing it now, really, the bankruptcy court was in an office building, it was assembly line.
:grouphug:

[Straight Shooter]

2. On the good side of that, they will get out of debt faster.

Always with the best interest of the consumer at heart :sarcasm:

As for the squeeze, I think the word he's searching for is "thumbscrews"

[Selatius]

4. This is business, what the fuck did anyone expect?

They own your debt. They own you. To be a capitalist is to be in a state of ownership over resources and the means of production. You, a human being, are a resource. You are owned. You're a cog in the machine, and this will further ensure you don't fly loose and do anything stupid like question their authority. Just go back to sleep, America. Just go back to sleep. Maybe they will not whip you and beat you down as hard if you remain passive.

:sarcasm:

[LSparkle]

8. I am now officially suicidal

Give me a drink ... What is the point to all of this anyway?

Wonder if Fidel could use a "trophy American" ... ???

[Deja Q]

54. I'll join you.

BTW: Regarding suicide, do your research beforehand. We've both suffered enough that we don't deserve painful deaths. The information is out there...

[earth mom]

64. Aha-yet another way to control the masses. First it's FEAR

next it's FREEDOM.

Will we soon be looking at debtors prisons or service in the military as a way for people who don't have any money to repay their debts...? :scared:

[Deja Q]

68. All right then. You find a way to revolt,

and I'll let you know if I'm convinced or not.

[earth mom]

78. I just replied to your post down thread....

hope it helps.

[BeHereNow]

88. Now you're catching on...

ALL of this is meant to reduce the options and
standards of living for Americans.
Want to eat, sleep in a bed with a roof over your head?
Join the army.
Or go to jail.
This is seriously going to wipe a lot of people
out.
BHN

[Romberry]

87. This move did not come from the credit card companies.

The various credit card companies were perfectly happy with 2 percent minimum payment that resulted in basically perpetual debt. The reason the credit card companies are raising the minimums is because they are under pressure from the United States Comptroller of the Currency (the office that has regulatory authority over these matters) to do so. The comptroller has held that setting minimum payments so low that they do not serve to effectively reduce the principal, or worse, actually allow the amount of the debt to rise even when minimum payments are made, is in violation of the various banking regulations and represents an abuse of consumers.

I tend to agree with the comptroller but the transition is going to be painful for a great many people who are just barely scraping by. Of course one of the reasons that many of them are barely scraping by is because they are paying carrying charges on month-to-month balances on credit cards and drowning slowly under the weight of accrued interest. (If they missed a payment somewhere and have been subjected to the provisions of "universal default", they may be drowning more quickly.)

The comptroller never should have allowed this situation to arise. At one time it was pretty standard for monthly minimums to be close to five percent of the balance. Under this new implimentation, monthly minimums could be even higher than that.

Since credit card companies (as a result of the new bankruptcy bill) are carrying so much less risk, the next logical step for the comptroller to take would be to demand that the card issuers reduce their usurious interest rates. I won't hold my breath on that one.

[davekriss]

98. Surfing to corporate serfdom

So true, Selatius, so true!

[K-W]

5. Ive always thought they were too low BUT

changing them on people is less than ok.

[merwin]

6. Sucks for the people who have a crapload of credit card debt, however

it's a VERY good thing for people who don't yet have credit cards or have minimal debt. The way credit card companies make money is by hoping that you'll pay the minimum, so if they double the monthly payment people will pay off their debt quicker.

Personally, I think they should only enforce this on NEW credit card applications, not existing ones.

[HornBuckler]

16. It's Intentional

These credit card companies are no idiots. They Know with the passing of the new bankruptcy legislature that they can bump the minimum up ALL THEY WANT without fear of people filing BK against them. Had that legislature failed, this would have never happened. The reason is simple - Large companies like the ones mentioned are seeing an influx in front-end (meaning 30-60 day late) balances. I can testify to this fact. The economy is totally messed up and they are seeing the effects of that. Now that this BK law has come to pass and takes effect in just a few short months, they will squeeze as hard as they like. (in fact the ability to charge up to 4% was part of this new legislation). So, as I said earlier - file if you have to and file now.

[Stephanie]

18. They are trying to push people into screwing up so they can raise the rate

If you don't notice the new amt and underpay, or can't pay it, or are late, they will bump your interest up to 25%.

[DS1]

21. Across the board

The same will apply to every form of credit you own. New rules. I think I heard John Kerry touch on in ONCE in campaign speeches.

[Zorra]

69. Exactly. n/t

[merwin]

20. It'll teach a lot of people a lesson in spending more than you make.

A good amount of people with credit card debt bring it upon themselves. People (including myself) spend far more than necessary to live, and build up a ton of debt.

[HornBuckler]

24. Welcome to America

Not to rip on you at all - I believe you to be sincere. Your point is precisely right - people do this and then something f'ed up comes up and whatcha gonna do?

[Union Thug]

25. But this is the basis for the credit card capitalism that we are living in

...If you don't take on massive amounts of debt, you can't have all the useless crap that the jones's have and you can't be a real American!

Seriously, if people only purchased what they could afford I think this house of cards would cave in...

[HornBuckler]

27. Well technically you are correct,

But let's be real. Your portrayal of the truth is not reality - People don't just spend to keep up with the Jones's they charge to cover rent/medical/etc. I must reiterate - If you are in this situation FILE NOW!

[Union Thug]

29. I don't disagree with you..

Obviously, living/medical are considerations in this economy, but there are huge amounts of people taking on car loans they can't afford so that they can impress their friends, or wiring their house when they don't have a clue about or need for servers, etc... You get the drift. Or, as my 18 year old stepson found out, having a cell phone (when he clearly has no need for one) got him in for a couple grand.

But, yeah, medical bills will kill you, regardless of your other spending habits and that speaks an ill truth about this country that requires another thread entirely.

[lildreamer316]

85. Do you have Cricket service in your area?

(cell phone service I mean.) Basic all the calls you can make a month for $35/$39 or so. Unlimited calls; unlimited min. You can puchase long distance min. or add to the package; right now I have had my service for 3 1/2 yrs and have most of the bells and whistles (insurance; call waiting, text; 500 LD min and calling to&in Charlotte) for 55.00 a month. Only catch is I can't take it out of the service area; so we have one Cricket phone and one Sprint with the lowest package.Maybe he could switch phones with someone if he went out of town (your son);other than that a Cricket would be perfect.
Sorry so long; just suggesting...

[Union Thug]

90. I'll check into it! THX! n/t

[Deja Q]

55. Bullshit. It won't stop Donald Trump, Ronald Reagan, or George W Bush.

[Union Thug]

22. YOu're dead on. File Chapter 7 and do it now.

I filed Chap 7 a few years back after a very ugly divorce...best thing I ever did. Got me back in the game after being absolutely economically crushed.

My bro in law recently filed Chap 13 (for no good reason other to take some sort of sick pride in that he is trying to pay off the debt)...and guess what...he pays more now than he did with the debt. And his credit was no better than mine (even though he attempted to be 'noble'). Don't let anyone fool you. Bankruptcy is bankruptcy. Credit reports don't discriminate. =)

But as you say, people better do it NOW because the CC companies are counting on the changes to the bankruptcy laws to squeeze the consumer harder than ever.

[HornBuckler]

28. Amen

You are SO correct - If you reside in an apartment file chapter 7 (Don't screw around with 13) I realize one might feel 'sleazy' for not paying back their honest debt - but do yourself a favor and file now. If you can do Chapter 7 do it - if you have a house/new car talk to an attorney.

[mike_c]

32. adding my voice to bankruptcy advocacy....

I had precisely the same experience as you-- filed Chapter 7 during an ugly divorce. Coincidentally, I just received the final discharge papers today. I have to say it was the most sensible financial decision I've made in a long time-- now I CAN live within my means, and I'm SAVING money rather than going further into debt.

So if this change is going to put a significant stress on your ability to make ends meet, FILE CHAPTER 7 NOW! If you don't, the credit banks will have you over a barrel for years to come.

[Deja Q]

56. Except more and more judges are demanding we move to chap 13 or they

throw out the case.

TWO credit counselors and a financial advisor told me this.

[mike_c]

61. talk to a LAWYER-- "credit counselors" often work for the credit...

...industry and will NOT tell you the whole truth. I never saw a judge at all, for example, and was only briefly questioned by a trustee. The whole proceeding took about three minutes. BTW, a "credit counselor" told me that if I included bank credit cards in my bankruptcy, I "would not be allowed to have a bank account for seven years." This was an outright lie, of course, and a violation of California law explicitly prohibiting making false statements in such cases. So don't rely on credit counselors-- talk to an attorney. They will give you the real scoop, and they'll work for YOU, not the credit card companies.

[Union Thug]

72. my experience too...

"BTW, a "credit counselor" told me that if I included bank credit cards in my bankruptcy, I "would not be allowed to have a bank account for seven years." This was an outright lie, "

FYI - my experience was the same as yours. My attorney accompanied me to the hearing and I was questioned by a trustee for about three minutes.

BTW- I included bank cards and STILL bank at the same place. Credit counseling is a joke (imho)

[Union Thug]

71. My lawyer told me that..

"credit counselors don't do shit..."

Bottom line.. go to a lawyer, don't use the credit counseling services. My sister (who works for a mortgage co.) told me that credit counseling pops up in credit reports and will reject you just as fast as a bankruptcy.

[Deja Q]

81. I'm confused. It's also been said that being on a cccs for some time and

paying back will improve one's score; because it shows you're doing the supposedly right thing.

Given how those who control society don't do the right thing, I don't know what the fuck 'right' is anymore.

[DeaconBlues]

7. this seems to go against what the credit card companies want

Isn't it there goal to keep people in debt so they will have to pay the outrageous interest on their cards indefinitely? If people pay off their debts they won't have to pay 30% to the credit card vampires anymore.

[phantom power]

11. this isn't likely to really cause many people to pay them off.

Doubling the minimum payment still isn't all that much, compared to the total amount of credit you can get. If a person has maxed themselves out to the extent that the minimum payment is all they can afford each month, they are really screwed. But it's lose/lose. It would still take a long time to pay off a large debt, making minimum payments.

[mike_c]

34. not only that, but it will likely trigger maximum interest rates....

The decreased payoff time is relatively negligible, but this will dramatically increase the number of people paying outrageous interest rates. The credit banks are going to make out like bandits.

[Deja Q]

57. Peak oil. They want to collect before we die.

[Xithras]

12. Crap.

I've got a huge balance ($10k+) on my BofA Visa. This is gonna hurt like a sonuvabitch.

[Enraged_Ape]

19. This just means we'll pay them off faster

The credit card industry really shot themselves in the foot with that obnoxious bankruptcy legislation. Anyone with half a brain is quickly and desperately figuring out how to divest themselves, as soon as possible, of their unsecured credit. My wife and I plan to be free of unsecured debt by Christmas of 2006. And we will celebrate like you can't believe.

[HornBuckler]

30. Good point - however

You and your wife are the exception. BELIEVE ME - they would never shoot themselves in the foot as you mentioned. They definitely KNOW what they are doing (preying on those that know no better) forcing 4% on people who will struggle to make these payments until the new legislature hits - THEN BLAMO you are hosed.

[Enraged_Ape]

35. Oh, I agree completely

They are definitely trying to hamstring those people (particularly young kids) who wouldn't otherwise know better. And they will most likely succeed with that.

But I think it will be a Pyrrhic victory, because in the meantime, those of us with just a tiny bit of savvy under our belts (who actually, most likely, have more money and the ability to be strung along on debt for far longer) saw this coming, and we are taking steps to get free of these loan sharks.

I noticed that MBNA is already running into problems, and that Bank of America is about to buy them out. Boo freaking hoo, is all I have to say about that. They buttered their bread, now they can lie in it.

[HornBuckler]

38. It's a done deal

B Of A has purchased MBNA. They buttered their bread and now they will wallow in the exuberant amount of revenue BofA will generate - On a side note - Buy BOFA stock if you can afford it, it will blossom like a son-of-a-bitch within the year (yeah, you can quote me on that)

[Deja Q]

65. Unless you can't afford food and medications or lose your job...

These traitors really know how to compassion themselves...

Sucker you in then hang the noose.

BTW: No sex threads. :rofl:

[anarch]

31. sure glad I've learned to get by without eating!

Man, fuck those fucking fuckers.

As far as "getting out of debt faster"...umm, yeah, if they hadn't also doubled my fucking interest rate without any warning...

On the one hand, I will never, ever make another purchase with any form of credit card ('course I said that before, and then fell into desperate financial straits etc....), but on the other hand, they will be making all kinds of usurious profits off of me for some time to come, since I don't have any fucking money to pay it off any faster than I am now.

Also: got my statement already for this month. They aren't joking about this.

[fasttense]

33. I don't have a minimum payment.

Double of nothing is nothing. But seriously, I owe very little and I send them a good chunk every month trying to get rid of the debt. I should be done in about 8 months. But are they going to give me a minimum payment now?

[MadHound]

37. If you folks haven't seen the writing on the wall by now,

Then this is a big glowing neon sign. PAY OFF YOUR BALANCE, CUT UP THE CARDS, AND NEVER, EVER GET ANOTHER ONE. The CC companies have been given the green light to behave like loan sharks, and that is exactly what they're going to do. Don't be one of the victims of this. If you've got an incredibly huge load of debt that you can't pay off, declare bankruptcy now before it is too late.

This is a stupid long term move by the CC companies, but in the short run it will devestate the lower and middle class. Pay off what you owe, but never ever use a CC again. Time to starve the beast.

[anarch]

44. I wonder...

if these companies are counting on a horrendous collapse of the entire economy sometime in the relatively near future. I mean a worst-case-scenario-Peak Oil-endless-nightmare-of-suffering-final-end-of-all-civilization kind of thing, from which we won't recover...and that's why they don't give a rat's ass about the long term. Maybe they figure they need to grab-grab-grab while the grabbin' is good, 'cause pretty soon NOBODY will be able to pay them anymore.

If that all came to pass, I guess this would be a shrewd move on their part, short and long term. Evil, but shrewd.

[MadHound]

47. Doubtful

American corporations, much like the American government, deal only in the short term, mostly with issues in the next quarter or next fiscal year. When you start thinking about four, five years out, you're really engaged in some long term thinking, and ten years out is just plain freaky in corporate America.

[catmandu57]

49. If that were the case

then money wouldn't be worth a shit anyway, they're picking off the low hanging fruit.

[anarch]

51. yeah, I suppose so

Just paranoid ranting above, really. Doesn't make me feel any better about the whole thing, though. It just feels like several more pounds of bullshit weighing down on the soul, and it is clearly predatory towards the "have-nots"

[the other one]

39. Bonus for the Banks: People will charge MORE!

If a person is living paycheck to paycheck, they will have less free cash after making their credit card payment, THEREFORE, they will have to charge items they might not have previously. As the credit card companies make 3% on every purchase, this should boost their profits becuase of the increases in purchases, the higher average balances earning interest, and the increased number of assessed delinquency fees because of general inability to make higher minimum payments.

[Cassandra]

40. I got rid of one card last year...

so I now have one personal card and one card for business expenses. I pay in full every month and I've been keeping my purchases low lately. I am proud to say that the banking industry hates people like me. :-)
My sympathies to those whose credit situation has gotten out of hand, particularly if it's due to a loss of income or an emergency.

[HornBuckler]

42. Good for you

The more folks like you can stick it to them - the better. But in reality you are maybe 2-5% of card holders (this is what I do for a living) If more of us can get out from this tidal-wave of debt we can be like you, and in turn put the burn on these assholes. Like I said in an earlier post - if you got the money buy stock in BofA , it will payoff in a windfall.

[Cassandra]

89. Well, my liberal parents taught me to pay my bills in full...

every month but my Republican broker lost half of my money in stocks. So I'll keep away from the market except to look for a few good bonds.
It's amazing how the wingnuts always think that they are so much more responsible than liberals. If someone did a study, it wouldn't surprise me if there was no correlation between political affiliation and unmanageable debt.

[SlipperySlope]

93. 30-40 percent of consumers pay their cards in full each month

http://www.cardweb.com/cardtrak/news/2002/june/12a.html

[Pobeka]

41. The falling dollar.

As the dollar falls, the absolute amount owed to credit card companies in "global" terms is also dropping.

It is in the banks interest to get as much as they can now, and move the money to non-dollar investments which are on the rise.

Otherwise they'd just let everyone continue to make 2% minimums and rake in more and more US dollars.

[HornBuckler]

43. Excellent point

I had not thought of that in so many words. You are correct, but I am afraid your foresight is a long way off. In the meantime, the passing of this new BK legislation, is nothing but a win-win for these dopes. But in the long run you make a great point.

[JanMichael]

45. Could this be the largest margin call in history?

Has anyone done the math?

[davekriss]

99. 1929?

This could, along with the rise in the cost of energy, create a crisis in effective (aggregate) demand followed by a crash.

Every dollar taken from the bottom-half of the economic spectrum and instead given to the top half slows economic activity. Those on the bottom have to spend all of every dollar they have just to make ends meet. Those at the top spend far less of every incremental dollar and instead park it in "investments" (or chase Bordeaux futures and Van Goghs, which are outside the core value chain feeding most of America).

If we had a crisis in capital formation (reflected in very high interest rates), then moving national income up hierarchy is valuable in a supply-side sort of way. But when we have idle capacity, as we do now, it has the opposite effect: It robs the economy of effective demand.

Like the Gulf Stream conveyor belt in the North Atlantic, the economy can chug along seemingly OK while absorbing quantitative change until, all of a sudden, we hit an economic winter that seems to never end. Is another Great Depression just up ahead?

What we're being set up for is a huge transfer of wealth up hierarchy as more and more people lose their jobs, can't service theri debts, and are forced into unfree chains of debt peonage. We'll see a rapid shift from a "middle class" capitalism to a new rentier society, with fat and happy overlords owning an even larger share of the pie while the rest work 12 hour/6 day work weeks to afford their rents and buy scraps of food.

Dystopia. May I be very very wrong!

[FormerOstrich]

46. People must not be getting behind fast enough to suit them...

this will cause more people to make payments late. If you pay late they will increase the interest. Watch for this one. When I started having trouble they dropped my credit limit (okay that's reasonable...I can understand that)..only the dropped it to under the amount I owed them. Then they charged me over limit fees!!!!!!! Don't trust them.


btw...for those of you that have been forced to resort to cards because of layoff or other....I understand. So did I. There are a group of posters that like to make you feel like you are some dumb imbecile because you have a cc, much less one with a balance. In theory they are right, but they haven't walked in your shoes. Don't let it get you down. This has nothing to do with how smart you are but a lot to do with how much the people have lost in the past four years.

[Deja Q]

53. What if a person is on a credit counseling plan?

I am finished if they ramp up the rates.

(not taking into my account my physical health, mind you... I know I'm toast soon anyhow...)

[supernova]

58. So glad I don't have a cc

I have one debit card tied to my money market account and it is paid up every month, much like an Am Ex.

I can do everything with it, and I don't miss CCs at all.

[Deja Q]

60. I'm debating... re: my credit counseling service.

I am on a credit counseling service. I just found out my rates ARE locked in at 2% unless I fail a payment.

One of my cards is not in their system however.

I can take out money from my life insurance and pay it all off.

But I know the state of my health; I do not believe I have the time to fully pay off all the debt...

Never mind my job situation, which is worse than my health because, in this "society", we rather need a job in order to frigging LIVE.

What should I do?

[sadiesworld]

67. You really need to talk to an attorney about bankruptcy.

As someone pointed out upthread, credit counselors will NOT tell you the truth.

[Deja Q]

77. For only $15,000?! And what bankruptcy will mean in the long run?

I'm screwed either way.

[sadiesworld]

84. $15,000K in debt is relative.

My only point is that if the new credit card rules are going to cause you a great deal of pain you may want to talk to an attorney, not a credit counselor. And if bankruptcy is a possibility, you may want to do this sooner rather than later. I imagine you can find an attorney who will give an initial consultation free of charge.

I think someone else has posted regarding a way around the new cc rules.

Good luck.

[earth mom]

76. I'm no expert,

but I'd take the advice others offered above. If your credit is eating you alive, File for Bankruptcy Now before it's too late.

Dh and I have had our share of financial woes the last 10 years due to working poor wages though we never filed bankruptcy. We thought about it but frankly couldn't afford to do it since at the time we were quoted between 2K to 3K cash up front. Now, most of our old debts have been paid off though it wasn't easy and there are a few still lingering around that we are working on. It's only been a year since Dh found a better job too, which helps, and we are grateful.

Because of our lingering financial woes, we haven't had a credit card in like 10 years. We've found that Credit cards really aren't necessary to live and you can do anything you want to do by paying cash or using a debit card with a Mastercard or Visa logo.

Hope this helps and Good Luck to you! :)

[Gemini Cat]

62. So what will happen if your house is paid off and you declare

bankruptcy? Can they take that away as well?
This is scarey.

[mike_c]

63. generally not, but talk to a lawyer....

Mine told me that the trustee will not force people to sell assets like a house as long as they file chapter 7-- it's a different matter if the bank still has title, of course.

[Gemini Cat]

66. Thank-you!

This has me scared to death, and I don't scare easy.

[sadiesworld]

70. Property exemptions vary state by state.

Contact a local attorney. Don't wait though as your options will decrease/change with implementation of the new bill.

[Union Thug]

74. Good point...

During the period I went through my bankruptcy, the primary residence was not affected (I'm in WA).

But ALWAYS GET AN ATTORNEY...

Again.. my attorney saved my ass and I would have paid him three times what he charged me for the services rendered.

[Greyhound]

79. It does depend on the State you reside in.

For example Ken Lay changed his residence to FL. just months b4 Enron collapsed. FL law let you keep your primary residence without attachment, even if your primary residence is a 200 acre compound in Boca (or some ritzy neighborhood) valued at $600 mil.

[earth mom]

82. In some states the total equity you are allowed in bankruptcy

is set at a certain limit. Sorry to tell you this, but you may have to tap into that equity to pay those debts instead of filing for bankruptcy. Check the bankruptcy laws in your state.

[Fescue4u]

75. Advice for anyone who this will SERIOUSLY hurt

Refuse to allow the change in terms.

When they send you a letter telling you that they are changing the terms, you always have an out.

In *small print* it tells you that you can refuse this change by sending a letter to so and so.

The catch is that you can no longer use the card. (which if this puts the squeeze on you, is a good idea anyway)

This works for rate increases, as well as minimum payment increases.

But becareful, if you refuse the change, and then make ANY transactions, including preauthorized ones, you release the CC company from the refusal, and the new terms kick in.

I did this with MBNA when they changed my rates from 9% to 23% !!

It worked like a charm

[DS1]

86. Nice, I didn't know that!

.

[Tactical Progressive]

83. When do you have to file by?

The bankruptcy laws change on Oct 17 I believe.

Does that mean that you have to file by Oct 17, or that you have to have completed the entire bankruptcy procedure by Oct 17?

[rman]

91. "They -are- the new loan sharks in America." (PBS Frontline)

That's a quote from

PBS Frontline: Secret history of the credit card
http://www.pbs.org/wgbh/pages/frontline/shows/credit/

In "Secret History of the Credit Card," FRONTLINE® and The New York Times join forces to investigate an industry few Americans fully understand. In this one-hour report, correspondent Lowell Bergman uncovers the techniques used by the industry to earn record profits and get consumers to take on more debt.

"The almost magical convenience of plastic money is critical to our famously compulsive consumer economy," Bergman says. "With more than 641 million credit cards in circulation and accounting for an estimated $1.5 trillion of consumer spending, the U.S. economy has clearly gone plastic."

Millions of American families use their personal, general-purpose credit cards such as Visa, Mastercard, American Express and Discover to make ends meet; credit cards have been a discreet lifeline for families in financial straits.

But other consumers, like actor and author Ben Stein, use plastic purely for convenience. While it would appear that Stein -- who says he charges a small fortune every month on his credit cards -- is the ideal customer, in reality, he is what some in the industry call a "deadbeat." That's because he pays his balance in full every month.

The industry's most profitable customers, the ones being sought by creative marketing tactics, are the "revolvers:" the estimated 115 million Americans who carry monthly credit card debt.

The average US family has 8 credit cards and $8000 debt.

Monthly payments use to be 5% of the balance. It was lowered to 2% to make it more attractive for consumers to use a credit card. Now that many fish are in the net, the big squeeze commences.

I'd think most of those millions who use credit cards "to make ends meet" do financially live on a very sharp edge, and doubling the minimum monthly payments will hurt these people badly. Many might have to file for bankrupcy...

--

Related NYT report
http://www.nytimes.com/2004/11/21/business/21cards-web.html?ex=1122004800&en=522be2392fd13b28&ei=5070&ei=5094&en=70effacd11d42b21&hp=&ex=1101099600&adxnnl=1&partner=homepage&adxnnlx=1121886496-jgrkVSq7Y0VGWTkd16Ei2w

[SlipperySlope]

92. I'm a deadbeat - I pay my entire balance every month.

I saw this coming and got prepared.

Hopefully the increase in rates isn't a surprises to DUers. Get your finances ready for it, and PAY OFF THOSE CARDS.

If you are carrying maximum balances, you are probably paying 20%+ to these big corporate banks every month. That is money that could be going to buy yourself things you want, instead of buying yachts for the bankers.

Unless you think that your bank is more socially responsible than you, and you have nothing better to do with your money than give it to the bank, you should get those things paid off.

[patcox2]

94. I'd call this a consumer protection measure and a good thing.

Noone should be paying the minimum. Its criminally stupid and irresponsible and enriches the credit card companies.

Nobody has to run up card debt.

[methinks2]

95. If they lower the interest charge without changing the

minimum due, we would be paying off faster. Gee I wonder why they don't do that? O8) :shrug: