Credit Card Companies Cleaning Up Their Fees
The good news is that many credit card companies are rethinking their fees. Because they want to be helpful? Heavens no! Because the government is threatening action. What this could mean for you.
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PrintWe all know by now that you pretty much need a credit card in this world. But unfortunately, those credit cards often come with fees that make it difficult to get out of credit card debt. Once you're in, the fees stack up -- from interest fees to late fees to transaction fees to an other fees. And any of these fees on your credit card could bump your balance up over your limit -- helping you incur yet another credit card fee. But the good news is that many credit card companies are rethinking their fees. Because they want to be helpful? Heavens no! Because the government is threatening action. Senators are falling all over themselves to see what they can do about credit card fees that are downright predatory. The Detroit Free Press offers some changes that credit card companies are already making to their fees:
Chase Card Services, a division of JP Morgan Chase, has eliminated two-cycle interest calculations, a costly practice for consumers. How did that work?
Say the customer pays, on time, $990 of a $1,000 bill. The $10 balance is carried over into the next month. What's the interest owed? It could be 11 cents with single-cycle billing -- or up to $11 with double-cycle billing.
Citigroup Inc. will no longer raise interest rates and fees for current customers at "any time for any reason." The change takes place for new customers immediately and goes into effect for current cardholders by April. Rates and fees could change when a card expires and a new card is issued, usually every two years.
What does this mean for you? Well, you're in a slightly better place when it comes to dealing with your credit card companies, especially if your credit is good. Now is the time to call and see if you can get a frivolous fee waived, or to see if you can get your interest rate dropped a couple of points. And, of course, let your lawmakers know that some predatory practices by credit card companies should be stopped.
Tags: credit card, personal finance, financial planning, finances,
financial goals, credit card companies, credit card fees, predatory credit cards
