Credit Card Reform Question?

[Anonymous]

for AA they still raise the rate for new purchases for being late, but if you become 60 days past due ,they can apply to new rate to the entire balance

[creditwherecreditisdue]

Discover has already raised their minimum payments...

[Anonymous]

Is there a maximum monthly minimum payment percentage? 

[Anonymous]

I don't know but I think a great many people are going to be severly disappointed in this. The reality is, that anytime we see more regulation, ESPECIALLY GOVERNMENTAL there will be loop holes in it .

I think in the long run this will do far more to eliminate the "free flowing credit" that many posters here feel is their right. I also think it will eliminate credit offers to many more people who might actually neeed them.

The Government has as always had a knee jerk reaction to things and have reacted quickly to satisfy a very few voices without really looking at what it will do. They have said in essence, we will keep you from raising interest rates. We will in essence keep you from throwing out offers of money which has brought us to the point we are now. Sadly,while there is a certain amount of truth in both statements, it fails to address the real problem.

I have talked with many people in the financial industry, including Bankers, Accountants, Attorneys etc and they are all of the opinion this will actually HELP ADD COVER to Banks. They say , you cant raise rates, then banks say, well we have to protect ourselves so we will lend only to "better customers". They say, you cant continue to throw loans out, and so Abnks don't make them as readily to consumers. They say you neeed fewer risky loans so BAnks will make more asset secured loans, such as to businesses etc, while making it harder on the Individual to get Credit.

Read the bill VERY CAREFULLY and you will not see where they can be mandated to LOAN MONEY (as was FORCED on Banks years ago, in regards to making money more accessible to people) and this will cover the banks, thus allowing them to say, "we are just doing what you asked". Better quality loans, better rates, more secured, less risk.

You will see some severe changes in availability of Credit to consumers in the UNSECURED AREA. Now granted, I think that is actually a very good thing and frankly all the people I speak to in the financial world do tell me the consensus opinion is that the Credit Card Bubble is the next to burst.

I just urge people to be in a position where when it does, they are not dependant upon constant CLI"s, Balance Transfers, etc to define their Creditworthiness, but it is defined by their use and payment patterns.

I sincerely hope everyone reaches their Credit. Goals.

[creditwherecreditisdue]

It is almost universally agreed that the commercial real estate bubble will be the next to burst. It's actually already happening.

As for consumers, DickC, the bank are in the business of providing credit. (They rent money.) If they don't provide credit they don't do business. If they don't do business they don't make any money. They will find a way to carry on. Tomorrow will look a lot more like today than it won't. The sky is not falling. (At least in that sense.)

[Anonymous]

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@creditwherecreditisdue wrote:

It is almost universally agreed that the commercial real estate bubble will be the next to burst. It's actually already happening.

As for consumers, DickC, the bank are in the business of providing credit. (They rent money.) If they don't provide credit they don't do business. If they don't do business they don't make any money. They will find a way to carry on. Tomorrow will look a lot more like today than it won't. The sky is not falling. (At least in that sense.)

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You are correct about the Commerical Real Estate Bubble and yes, it is universally recognized it is actually happening. That is why they say they say the Credit Card Bubble is next. Commericial Real Estate is already here and prudent people are looking forward.  They are preparing for it.

Absolutely Banks will find ways to lend money. They always have. The truth is though what many hail as cover for the consumer will indeed be cover for the Banks.

I have no illusions at all the sky is falling , as a matter of fact, I think the sky is actually going to get brighter for people who act responsibly. Yes, some will always think it is falling, but then again regardless of what circumstance they are in, it will be someone elses fault for happening and someone elses mess to clean up.

As for me, I see things getting better. Some won't. Luckily time will prove which scenario is correct.

[creditwherecreditisdue]

I've said for over a year now that when the dust settles those at the lower end of the credit spectrum are going to be left standing on the street looking in when it comes to unsecured credit. The time to get your credit house in order is actually already past. I'm afraid there won't be any new subprime issuers coming along to save the day either. That business model's been tried and there's no way to finance the paper now. No way to collect large initial fees from new cardholders either unless they're willing to pay them up front. Not to be elitist about the matter, but what end of the spectrum are all the CC problems coming from anyway? None of this was caused by the Credit CARD Act of 2009. The bad extentions of credit came well before and "The Act" is not resposible for the tanked economy. (That's a subject we don't discuss here.)

[Anonymous]

I agree completely, those who probably need some form of credit extended to them the most, will be those hurt the greatest. A shame it has to be this way but that is whats going to happen.

Many changes coming in the unsecured market and like you say, those who have their house in order will ride it out and be fine. Those who do not, will have problems.

Glad to know you have your credit house in order.

[creditwherecreditisdue]

We'd all be better off if those who had credit need but were not credit worthy had been sidelined during the easy credit binge. Now we all gotta have a hangover.

Meanwhile, the bank are still gonna extend that credit to somebody. It's just going to be a different distribution of somebodies...

[Anonymous]

Yes, they definately will be extending it to someone. I actually consider myself fortunate that we are at the position I can easily say "No Thank You" to the offers.