When the Federal Reserve finally made changes to the terms and conditions of their credit card holders, some of these changes came back to haunt the credit card companies. Yes, you read it right. Some credit card companies needed to change their policies and some did. However, the larger companies modified their credit card rules and it seems that lenders will follow any other competitive changes that occur in the consumer credit market.
The reaction to the changes was mainly just like us (that is, interest rates.) When interest rates on credit cards were increased, many consumerst who could not pay off their balances immediately took note and adjusted their monthly payments accordingly. Based on the three and six months of national averages on the number of balance transfer cards, the changes almost doubled in number. Some cards saw a more than ten percent increase in balance mathematician and credit card holders were expecting even better.
Meanwhile, the credit card companies were assuring themselves that the increased payments would actually decrease outstanding balances. One of their few exceptionATM withdrawals. That is, until the overdraft fees began showing up on their monthly statements. The monthly fees for overdraft protection, which credit card filers and other customers must pay for, began to rise to nearly $40 per statement. That is, a minimum fee of $1, which was so high that many folks began to avoid ATM withdrawals altogether and just went to their credit cards as a source of cash.
That is also when the Bankruptcies in America started to rise and when many folks realized that credit card debt is a legal and a bad thing. Well now, those folks are now learning. As these companies are attempting to adjust to their new rules, they are again reading books on self help debt reduction and are starting to implement their own rule changes. The terms and conditions are not going to change to reflect these rule changes and they will remain in effect until at least July of next year. For those of you didnt know, in the NFCC v.mable contract lawsuit, the real hard and demanding rule allowed credit card companies to bar debtors from filing a second suit leading to ripoff report scam. I doubt this is possible anymore since it has been ruled in the case of the NFCC v. American Express Travel and Charge Cardettlement Cardholders that on-line shopping is a legal shopping event.
The credit card companies are heartless, but it was almost by law and for insurance reason. They wanted to regain the market share and a lot of cardholders decided to head for the exit. It led to a double digit increase in the rate for many cards and interest rates jumped up a lot.
In addition, the charges for making late payments went through the roof. Besides, the cases for cliff insurance went through and also require the cardholders to pay for a credit report from the three credit bureaus each year. The law also requires you to receive a free report every year.
The bottom line is, there are additional charges for every American cardholder, but it makes sense to the account holder. Their terms and conditions are very subjective and very problematic for those who are trying to make a fresh start with their finances. American Express, Discover, Chase, Bank of America, etc., are all creating a huge profit base, but consumers are finding higher costs with no real reduction in their balances.