Abusive Credit Card Rates, Fees, and Practices: The More, the Better?!

The more messages to Washington about how sick we are of the industry's unfair credit card practices, that is. "Listen to the 56,000" is the lead editorial in today's New York Times, which discusses the "astonishing" 56,000 comments the Federal Reserve received from "outraged consumers" in response to its proposed rule changes to rein in credit card lenders.

Yesterday's Washington Post called it an overwhelming response, and Tuesday's Columbus Dispatch headline was: "Angry Ohioans clamor for fair credit-card rules." It talks about the comments from "5,000 furious Buckeyes" that Richard Cordray, state treasurer, had collected to deliver to the Fed.

People from all over the country are speaking up. As The Times puts it,

"This anguished deluge should send a clear message to leaders in Washington. The Federal Reserve should swiftly adopt its proposed rules against unfair or deceptive credit card practices. But the real burden to curb these abuses falls on Congress."

I agree. The House recently passed a Bill of Rights for Cardholders. Next up is the Senate, which ought to pass Chris Dodd's bill, known as Senate Bill 3252, which would prevent:

• "Any-time, any reason" interest rate increases.
• Universal default.
• Changes to the terms of credit card contracts during the length of the contracts.
• Rate increases from being applied to credit card debt that’s already been incurred. (Rate hikes would only be applied to future debts.)
• Issuers from applying payments to the lowest interest rate balance and instead, require them to credit the balances with the highest rate, first.

It's time to let our Senators know "we’re mad as hell and we’re not going to take it anymore" (loosely based on the famous line from the movie, "Network"). Consumer Action makes it easy, with an online form you can fill out in a couple of minutes and send off to your Senators. Interestingly, Consumer Action set up this letter so it's a snap to personalize your message a bit.

That seems to be more important these days, when it's so easy for people to click and send a form letter. The Fed seems to give the "more than 27,000" copies of the ten different form letters it received a lot less attention than the 16,021 unique responses it received.

Did you notice that these two numbers, which I took from the Federal Reserve, add up to 43,021, which is not even close to the 56,000 figure The Times is using?! I called the press office at the Fed, and found out that they have received about 56,000 public comments. "They're continuing to process them."

While the Fed is still digesting the messages it received, how about dropping a note to your Senators about unfair credit card practices? I think you'll feel better for having spoken your mind, and for helping to improve the system. In addition to speaking in favor of Dodd's bill, I told my two Senators to come back to Washington and get to work, which definitely made me feel better. Why should they get so much time off when we don't? Talk about unfair!

Nancy Castleman – Co-author of "Invest in Yourself: Six Secrets to a Rich Life" and founder of Good Advice Press. Nancy has spent the last 23 years teaching people how to get out of debt, save money, and live better on less. She writes on all these subjects for CreditBloggers.com. 

Comments

[Redmite]

Credit cards are out of control and have creative license to make their own rules. But isn't that what capitalism is about.

www.your-credit-cards.com

[Nancy Castleman]

I'd like to think capitalism is about more than taking advantage of people. Lenders can make money and be fair, imho.

When I first read that New York Times editorial this morning, there were 60 comments. Now there are 197. The more people speak up about this issue, the better!