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Thread: Have a credit card? Listen to this!

  1. #1
    Join Date
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    Have a credit card? Listen to this!

    Here is some real eye opening information about how credit card companies make their money, and it's not from your normal interest rates. A Harvard Law Professor who has testified before congress on abusive lending practices by credit card companies lays it all out. Even if you pay off your total bill each month, there are ways they can get you. Well worth the listen.

    http://www.npr.org/templates/story/s...toryId=9156929

    Dan
    "A dog teaches a boy fidelity, perseverance, and to turn around three times before lying down."
    Robert Benchley

  2. #2
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    Pretty Scary stuff
    Live Like You Mean It!!

  3. #3
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    In a word...

    Disturbing.

  4. #4
    A couple items:

    1) In general, NPR is not fair and balanced.

    2) It is difficult to buy over the Internet without using a credit card.

    3) If you pay off your bill every month, the interest rate can go to 1000% and you don't care.

    4) If you can't pay off the bill each month, you should not be buying the items in the first place.

    5) If you want a loan, go to a Credit Union, not a credit card company.

    6) The ultimate responsibility is with the consumer.

    7) Sympathy is in the dictionary.

  5. #5
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    Ken is correct, but...

    The reality is that credit cards are here to stay. That doesn't mean we have to put up with the tactics of the credit card companies. Just this week, I had to cancel my VISA card because a fraudulent transaction was posted. I Googled it and discovered that someone had figured a way to establish a monthly charge for $12.95 for goodness only knows how many credit card holders. I noticed because it was the only charge on my card. Hard to miss! So I called the credit card company's security department. They canceled the card and are sending a new one. I have a mind to not renew it when it gets here!

    But here is the kicker. They want to sell me 'protection' at $7.95 per month to avoid these sorts of things. First they charge Mafia-style interest rates. Now they sell 'protection.' Since it costs them money to reverse charges and reissue cards, and since they obviously can keep these kinds of charges from happening, what kind of business model allows them to continue what they are doing? The cynic in me says "because they are making money doing it this way!"

    How many times can you make a charge on your card, even in a face to face transaction, without a signature required? I have "ask for photo ID" printed on the back of my cards (2). Rarely does that happen. One business said I had to sign the card then and there or they wouldn't allow me to use the card. I replied, "How do you know that I am the legal owner of this card?" I can sign any darn thing, they wouldn't care. At that point they had a choice. I held up the line while I demanded to see a manager. I quietly explained how their business practices actually aided the use of stolen cards. Then offered them the opportunity to make the sale the way I had offered (which was to accept my photo ID with the card without signing the back of the card) or have an employee return things to the shelves. Simply asked which was more important to the business; to mindlessly aid and abet those who manipulate the system or accommodate the customers who come into the business to make a purchase.

    So the no annual fee card will require one to buy the monthly 'protection' in the near future. Bet on it. Soon to follow will be the cards with an annual fee. Then there will be a fee for the months you have no charges. Followed by a fee for paying off the entire amount each month. Think I'm crazy? Look at the interest rates. 18-21% and lobbying for higher limits.

    We all know the story about not doing anything because "they didn't come for me." They will.

    The question is what will we do about it? When will we do something about it? What can we do about it now? Having a credit card should be a convenience for the consumer, not a right to drive the Gross National Product!

    Oh, you read this far! The store made the sale. Of course, I was talking to a manager that had some authority to make a decision. That is sort of important.

  6. #6
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    Quote Originally Posted by Ken Garlock View Post
    A couple items:

    1) In general, NPR is not fair and balanced.
    This isn't about NPR--It's about the unfair and unbalanced position that the credit card industry is in. They CAN get you if you don't notice that they deliberately change your due date in hopes that you will be late with a payment. I wonder if you will be so complacent when you discover that they have added bogus charges to your account, and it takes you hours of wrangling over several months to correct the problem. The fact is, those are not mistakes on their part, it is done deliberately because they know that if even a small percentage of people don't catch it, the industry will reap great rewards.

    I agree that the individual should be accountable for his or her actions, but shouldn't the industry be held to a similar level of accountablility as well? Wouldn't this be more "balanced", if balance is so important to you?

    Dan
    "A dog teaches a boy fidelity, perseverance, and to turn around three times before lying down."
    Robert Benchley

  7. #7
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    Quote Originally Posted by Dan Forman View Post
    They CAN get you if you don't notice that they deliberately change your due date in hopes that you will be late with a payment.
    The nice people over at that 'green' card company have changed my due date no less than 8 times in the past 2 years. Always sooner, of course. It has inched down from 30 days from the closing date to 14! Hardly enough time for me to receive the bill in the mail, enter it in Quicken, and get it paid.

    Needless to say, my days with them are numbered. As soon as we cash in our 'points' we're taking the 'express' way outta there!
    “We all die. The goal isn't to live forever; the goal is to create something that will.” - Chuck Palahniuk

  8. #8
    Don Taylor is offline Former Member (by the member's request)
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    I have been in two situations that stand out in my memory, where I spent over two hours filling up a couple of grocery carts. When I got to the checkout and started counting out the cash, I was told, "Sir we aren't set up to take cash, you will have to use your credit card." (I wish I could remember the name of the store, it was in GA. years ago.)
    Both times I just stared at the cashier before I replied, "you are telling me you will not take my cash money?" I figured they had to ask for a card but would give in to make the sale. When I was told that they in fact would not take cash, I nearly choked laughing. Although I had my Visa Debit card in my pocket, I left both full carts where they were and laughed my way out of that store.
    The people are aware now what these credit card companies are up to but continue to sign the contracts and send them back to the companies unread.
    We also know that if you point a gun at your foot and pull the trigger, you are going to shoot your foot. The way I see it is it's sort of hard to blame Smith and Wesson.

    Moral: Don't point a gun at your foot and pull the trigger.

    DT

  9. #9
    Quote Originally Posted by Dan Forman View Post
    This isn't about NPR--It's about the unfair and unbalanced position that the credit card industry is in. They CAN get you if you don't notice that they deliberately change your due date in hopes that you will be late with a payment. I wonder if you will be so complacent when you discover that they have added bogus charges to your account, and it takes you hours of wrangling over several months to correct the problem. The fact is, those are not mistakes on their part, it is done deliberately because they know that if even a small percentage of people don't catch it, the industry will reap great rewards.
    <<<SNIP>>>
    Dan
    My comment about NPR is about the article, and how accurately the 'report' represents what is actually going on.

    I check my due date every month, but I make it a point to pay the card 2 to 5 days ahead of the due date.

    I have had two bogus vendor charges on my card over the past 10 years. Each time I opened a 'dispute' about the charge and I was treated well by the person on the phone. Each time the dispute was resolved in my favor within 30 days.

    I repeat, it is the responsibility of the individual to keep their financial house in order. Part of that is to review every bill sent to your house and check its validity. Check not only the CC bill, but the electric, gas, water, telephone, etc.

  10. #10
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    Hey Don, I worked for a week in a little town in AZ where no one took credit cards at all. Nearest bank was in Chandler (I think), and nearest ATM was at a truck stop about 30 miles down 66 to the freeway. Cost me $5 just to get enough cash to buy our drillers dinner on their last day, probably cost the company another $5 in gas. Kinda the total opposite of your story, eh?

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