Do you think credit card companies are killing themselves?

Question

One time I was late 1 day on my payment. My interest rate instantly jumped to 19% from 7. I was charged interest for the ENTIRE billing period on everything, even if it was purchased halfway through the billing cycle. I was charged interest on everything in the next billing cycle even though I paid off the balance entirely . And then everything that was purchased between the time I got my next bill and they got the payment on that next bill was charged interest on. CRAZY! I'm using cash more now adays because of this. I just don't trust them anymore. So I think they're disenchanting many people and loosing business.

Answer 1

Credit card companies are operating an "Ah-hah, gotcha!" business, and it's working for them because so many people are on the edge financially.

Once the interest rate jumps from 7% to 19%, and they toss on extra fees for late payment and possibly over-limit fees, they can't keep up, and the interest rate jumps to 29%, and there's $60 in extra fees on top of that for late payment and over-limit fees that they just can't afford.

Oh, and it's not just the card you were late on. If you are late on your Bank A MasterCard, the rates jump on your Bank B Visa, and your Sears card as well.

If you're sitting pretty financially, you can get a second mortgage, pay off ALL your cards, and switch to using debit cards until the interest rates on your credit cards drop back to reasonable rates. A lot of people can't do that, though.

For the past 30 years, the number of people filing bankruptcy keeps growing, and the credit card companies keep lobbying congress to tighten the noose, so that credit card companies get paid off even as everybody else the people owe get nothing.

I guess if you make a big enough investment in buying politicians, you can pull it off.

Answer 2

The credit card companies are not killing themselves, they're making a killing. That is their business. If you don't like the terms of one card, get a different one. You sign an agreement with any card you get, and you should know the terms well. Credit is a great tool to allow you to buy things and protect yourself in emergencies, but any tool must be used wisely. Anyone who tells you to avoid credit whenever you can is crazy. Many cards will offer up to 5% cash back on every purchase you make. More typically you can get at least 2%. That is a discount you are throwing away if you pay cash instead of credit. Also, having a good credit history will help you buy things in the future like a new car, or a house. The key is to not buy a bunch of stuff you can't afford. If you can't pay the balance off each month, then don't buy it. It doesn't make sense to pay a bunch of interest on a pizza you bought two months ago. Use your credit wisely, pay off your balance on time every month, and you will prosper. Use it recklessly, and you will drown yourself in debt. Good luck to you.

p.s. If you have a good history with a company, they will often forgive your first late payment. Just call them, be polite, and explain your circumstances. If they won't budge, shop around for a new card.

Answer 3

Credit Cards are more widely used than ever. Credit Card companies are making money anywhere you look. Not only do they catch you paying interest but they make 2 to 5 percent from the merchant on everything you buy with your card. I don't think they are in danger of going out of business anytime soon. I recommend going the cash route any chance you get. The credit card companies don't do anything but make money off of your hard work.

Answer 4

I don't use them at all, but our world is so dependent on them, they don't care what one person thinks. Everyone is so busy living outside their means (plasmas, lap top surround sound)
they need these cards to survive. I personally pay for everything cash besides cars and my home. People who use cash are not the norm, now adays people charge everything. So sad.

Answer 5

No. There are too many people in the world for them to sink themselves. Smart people use cash when they can. Even smarter people budget their balances on their credit cards. And idiots just use credit cards for EVERYTHING...cut them up and toss them but dont close the account...

Answer 6

the only way to use a credit card is think of it as a debit card -- instead of pre funded you have to keep track of your changes and pay off the balance at the end of the month.