Should there be laws to restrict credit card companies ?

Question

Should there be limitations on giving credit to those who are obviously in trouble. Should they be allowed to charge any finance charge or interest rate they choose? Why is this allowed?

I understand that there should be an element of personal responsibility BUT the same applies to drugs, Just because people are irresponsible enough to take them, does that mean we should just allow the drug dealers to keep supplying the drug?

No! I am NOT interested in a Chase or any other credit card. I am more intelligent than that! Give me a break.

Answer 1

we need to write our respective representatives and maybe if a lot of noise is made then they would have to do something about it.

Answer 2

Though the credit thing is weird and most humans cannot figure it out it works in a way.

Those who have carefully worked their credit and have saved money have no issues. Once you reach a certain point and have enough for a serious down payment for something the credit score becomes a bit moot.

Interest rates? Once you tender your credit regardless of the level of income they just want to give you better deals. If one is obviously in trouble it is built into their business model. Basically it comes down to this.....

If in thhis day and age you muck up your credit.... you did it. They card companies realize that your entire future depends on this. Yes there should be some laws but the law makers pay their bills so no worries for them. It is what it is and most who complain do not manage their finances.

Answer 3

I think there should be a lot of laws to help those who are in obvious financial trouble. I mean, if you give a credit card to someone who's already in a lot of debt then it is just adding to that person's problems.

Some people get pre-approved credit card applications in the mail & they automatically apply for them. It's crazy. I had some problems with credit cards in the past and even though I had 3 cards that all had outstanding debts they would still send me pre-approved applications in the mail. I finally set myself straight & I wouldn't fall into that trap again.... but not everyone learns from mistakes like that.

there should definitely be laws that would limit the people who get credit cards. I mean, not only would it save the people in trouble..... but it would also save the credit card companies a lot of trouble because they wouldn't have to worry about all this money that isn't being repaid or filing claims for collection & so on....

Answer 4

Although it's sad that it happens. No there should not be limitations on giving credit to those who are in trouble. That would be discrimination. The interest rates are disclosed to the customer and they choose to accept them. It's up to the person applying to know if they can afford the card and it's interest rates. It's allowed because if a credit card company is willing to give credit to a high risk customer they are entitled to receive higher interest charges. Just like a car insurance company charges a higher rate for a person who has had accidents, they are assuming the risk.

Answer 5

Try putting the blame where it is do. Look to those who spend more than they earn. To the person who has $5k in credit card debt and has a 50 inch plasma TV in their living room.

Credit card companies, like all companies are in it to make money. You cannot say they are in the wrong. Nobody puts a gun to your head and says “agreed to crazy terms and use this card”.

People are blaming credit card companies rather than placing the blame squarely on those who deserve the blame, the overspenders.

That said, some people really need to spend money they do not have (i.e. an emergency). So credit card companies to have their utility. These people may also not be in a position to pay it back. So, to hedge their bets the credit card company has to charge more interest. Would you rather have it that high risk people not be able to get any credit at all? And generally, there is no interest if you pay your bill on time.

Answer 6

believe it or not..those rates are pretty flat. You the consumer have to read the "prospectus" when you get it in the mail.

Obviously some people will not get "approached" by the < 10% companies, but then....businesses are in business for a reason, to make money. If the individual is wreckless enough to need to go w/ a 20% credit card..then it's their problem and not the banks to begin w/.

but they all charge a pretty flat rate that is based upon your credit score and current market rates...

also....ability to pay is in the banks interest.
They dont really make money on people who default, and never pay, or the ones that always pay... although the always pay is about 10%.

Answer 7

In a pure capitalistic society, the market will 'limit' itself in this regard, and governments of those societies are loathe to make laws restricting market economies.

If everyone just quit using credit cards, then interest rates would drop 'like a rock'.

On the other hand, the Bible speaks of the evils of excess usury (interest rates), and of debt forgiveness (every 7 years).

This question is a hard one to answer.

.

Answer 8

I use to work bankruptcy, oh my goodness. Some people would get 3 cards and run up $60,000 at 29% file bankruptcy and 3 months later the same credit cards companies would give them another credit card at like 9%. It all depended on your credit.

Answer 9

There are laws. It's clear that, in some ways, there aren't enough (in my opinion). However, what you're proposing isn't going to go over well.

The reason credit card companies can do what they want (not really, but it seems that way) is that they can. They take on the risk of lending you money. In exchange, they call the shots.

Don't like it? Don't use the cards. That's the basic thought.

Answer 10

how do you distinguish between someone in trouble who needs that line of credit to get back on their feet and someone who is in trouble who doesn't care and will use that line of credit irresponsibly and get deeper in debt... the truth is the credit card companies don't care, they are a business; the business of making money and they don't care who gets the credit cards because they are making big bucks on you... that is why credit card companies are at every single college across the country, at every event where there are chumps that will sign their lives for a few extra hundred/thousand dollars... i think it is up to the individual on this one, you can't blame the corporations or the government for personal ineptitude.

Answer 11

Yes there should be. That's what's wrong with this economy now. We are so in debt that we will never get out. And who benefits...the credit card companies.