03-18-2009 09:01 AM
03-18-2009 09:05 AM
03-18-2009 09:15 AM
03-18-2009 09:59 AM
I noticed my Sears Card interest rate went from 20.40 to 21.99% this month. I never have to pay the interest because it is my highest interest card, so when I use it I normally pay it all before the billing cycle ends.
I wouldn't be concerned about your Sears interest rate. Your other card's interest rates will be going up also. By the time the new credit law kicks in next year, all credit card ongoing rates will be much higher.
The advantage of using store cards has always been their "promo" deals and short term low or no interest rate offers.
Since no card issuer will be able to raise interest rates on existing balances after June of next year, even the bank Visa and Master cards will behave like "store cards".
Visa and Mastercard credit cards will have much higher rates. There will be plenty of temporary promo offers. The new law specifically states that "promo" rates are exempt from the provision prohibiting rate hikes on existing balances.
Basically the big banks succeeded in getting legislation passed that will ultimately increase their profits. All credit cards will operate like high interest rate "store cards".
The banks will only lower the rates temporarily in order to draw the consumer deeper into debt (just like a store card). Once the consumer runs up debt and the temporary rate expires, the consumer will be stuck paying very high interest rates (just like a store card).
Although "Sears Doesn't Negotiate", I believe that most banks will "negotiate" lower interest rates even now so long as they are officially classified as "temporary" and thus exempt from the new law's so called "consumer protection" features.