Would someone please tell me why
this makes any sense . . You'd think the Feds would be pressuring creditors to refrain from nasty rate hikes on the consumers lest spending take a nose dive.
Minimum Credit Card Payments About To Double
Bankruptcy Laws Making It Harder To Qualify
Other than being greedy bloodythirsty bastards, that is.
More on the flip.
Credit card companies have been given the OK by federal regulators to get more of your money each month, according to WCAU-TV in Philadelphia.
The minimum payments on your credit cards might be about to double.
Currently, you have to pay at least 2 percent of your total balance. Now, the credit card company will be able to double that to 4 percent.
Doesn't sound like much, does it? But if you do the math, a credit card debt of $8,000 will cost another $160 a month under this balance repayment level.
I did get a good laugh out of this line though, "If you have drastic debt, it calls for drastic measures. [Give] up vacations, vices and other big-ticket indulgences."
Update [2005-5-6 17:57:40 by idiosynchronic]: For reference, I found this on the BCS Alliance website. BCS isn't exactly one of the good guys, but they do state a point of credit wisdom better than I can.
A second tactic used to increase profits is to require a minimum monthly payment of only 2% to encourage cardholders to continuously carry a balance so they can rake in more interest income. . . But there are still too many consumers who carry a balance and regularly pay only the minimum each month. The credit card banks love these customers for obvious reasons.
So I say again, WTF? Jacking the minimum payment on the principal makes no sense according to the rules that have been in play for the last few years.[/UPDATE]