Exactly who is it that needs reforming?

Even without the new Bankruptcy laws credit card companies acted with relative impunity. Take a look at the following, compare it to the fine (miniscule) print on your credit card agreements, and pause for a moment to reflect on what they'll do now that the shield of Bankruptcy protection has been stripped from debtors.

Does your card contain any of the following:

A universal default penalty: Credit card issuers regularly check their customers' credit reports for late payments on any of their bills. That's ANY. Any late payment can trigger an interest rate hike, even if you have never made a late payment to the card issuer.

The "grace period": Historically, these were 30 days. Now, they go from an average of 23 days, some at 20 days, and some with no grace period at all.

Two-cycle billing: Normally, card issuers use the one-month method to calculate interest charges, but some use a method that calculates interest on two previous months' balances.

Inactivity charges: Not using your card can cost money. Sometimes as much as $15. The inactivity length varies.

Late payment fees: A recent study by Vertis, a marketing company that does credit card research, found that 2% of all credit card holders occasionally miss their payment date. The national average for the infraction is $29. According to Consumer Action, MBNA, Bank of America and Providian customers pay $39. Consumer Action also found that just one or two late payments will trigger a higher interest rate.

Over-limit fees: Exceeding a credit limit by even one cent will result in over-limit fees of $25 to $39. At that point the $39 late fee, itself, can trigger a $39 over-limit fee.

These are but a few of the practices used by credit card companies. An easy-to-read, more complete list (includes the above and more) can be found on the MSNBC MoneyCentral website.

It's also worth, to the tune of thousands of dollars, to understand that credit card companies can have a huge impact on being able to afford to purchase a home, or by tacking thousands of dollars on your home payment. The results of a study by the Federal Reserve Board show that some credit card companies fail to report your credit limit to the credit bureaus that maintain your credit history and credit score. This omission can lead to your being declined a mortgage or, alternatively, paying a higher rate on the mortgage you do receive.

Luckily, the Administration and Congress saw the problem and acted immediately-- against debtors.



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