Predatory Credit Card Companies
I recently read an article in Time Magazine written by Daniel Kadlec about how Credit Card companies were becoming even more predatory in regards to milking their customers. It’s not as if they weren’t doing well-enough already, right?
Here are some of the ways credit cards companies are trying to maximize their potential and all the while sticking it to the people who use their credit cards:
- Late Fees have been increased to an average penalty of $30, going as high as $39. In the mid-90’s the average late fee penalty was closer to $15.
- Balance Transfer Fees of typically 3%. So if you transfer $5000 in credit card debt to another card, it’ll cost you $150.
- Minimum payments have increased across the board, doubled in some cases.
- Foreign Currency Conversion Fees of also typically 3% every time you use your card abroad. (Take it from my personal experience that they also charge this for purchases in Canada!)
- Closing down an open account with a zero balance due to inactivity. This hurts because every time a line of credit is closed your credit score negatively takes a hit.
So while we can complain all we want, we have no one to blame but ourselves. The Credit Card companies disclose all these money-making schemes to us in the 20 page, microscopic font “CardHolder Agreements” that they send us with their credit cards.
The only real solution if you don’t want to be taken advantage of by these predatory tactics is simply not to use the Credit Card companies’ products.
Easier said than done, I know.
Here’s the link for that Time Magazine article if you’d like to check it out:
— Attorney Andrew Partridge