Money Coaching Monday: Credit Card Practices Bankrupting Americans

Monday October 19, 2009

Categories: Current Events, Financial Crisis, Financial Healing Prayers, Financial Recovery, Healing Debt, Money Coaching, Money Prayers

Before the recession began a little over a year ago, credit card companies were offering some of the most attractive rates and balance transfers ever seen. Many people were using credit cards to not just supplement their lifestyles, but many also began using these offers as a means of financing their businesses.

It made sense to transfer an 8% SBA loan to a 3.99% fixed rate with a credit card company...that's quite a savings. The problem is that apparently these companies can't be trusted and their "lifetime" fixed rate offers were not worth the paper they were printed on.

As we speak, the banks that we bailed out with billions in federal loans, are now rapidly changing the rates and terms of their previous agreements and driving more and more people and small businesses into financial crisis and bankruptcy. Without cause or conscience as to the potential consequences they are creating for their customers. Customers who were paying faithfully and honoring their agreements no less.

That's right...you don't have to have been late, gone over limit, or done anything for that matter for a bank or credit card company to raise your rates, decrease your line of even increase your required minimum payment to twice it's previous amount.

Meanwhile, the new credit card law that Obama signed in May, which was meant to prevent these very practices from occurring, is not effective until July 2010. Effectively, what the government appears to have done is provided a window of opportunity to these companies to do whatever they please. By the time the law is effective, it'll no longer be needed and the damage will be done.

Personally, I think this could become the equivalent of the mortgage industry debacle that began the cycle of this economic meltdown. Millions of Americans have a credit card with a balance. If credit card companies continue with these blatantly abusive practices, the national default rates will increase. And we cannot afford another meltdown.

We greatly need to pass the Credit Cardholders' Bill of Rights and we need it now. I strongly urge you to contact Congress and your local representatives now. Tell them your stories and how these unethical and unfair credit practices are affecting you, your family and/or your business. Urge them to pass this new law before more Americans are driven into financial crisis and insolvency. Enough is enough.

Peace & Blessings!

Comments (1)

Filed Under: beliefnet, credit card bills, credit card rate increase, financial crisis in america, fixing credit, unfair trade

posted by Deborah Price @10:35am Permalink email icon

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October 20, 2009 2:41 PM

Source and uses of funds need to match payoff terms. Credit card debt is for monthly bills. SBA working capital loans are term loans for 7-10 years. You credit card lender will cop out on you if you hold the debt like a term loan. The SBA term loan will be there for the full term and amortize the principal to zero. Which would you rather have?