Will a Debtors Revolt Affect Credit Cards?
September 26, 2009 by Miranda Marquit
Filed under Finance
One of the ways that credit card issuers make money is by charging high interest rates and attempting to keep you in debt. Minimum payments are purposely low so that you can continue to pay them, and interest rates are high so that credit card companies make more money. This system is an indispensable part of the way that credit card issuers make money. It is also a very large part of the way our economy works.
But what would happen if all the debtors revolted, like this woman advocates? In reality, if credit card issuers lowered their rates and moderated some of their practices, the world probably wouldn’t end. They’d still be profitable. However, if everyone defaulted on their credit card debt, there would be mass chaos and many companies would find their balance sheets in dire straits. It’s an interesting situation to contemplate.
At any rate, the connection between the unsustainable economic growth of the last couple of decades and an increase in consumer credit and debt is most definitely there. If Americans really do decide to change their habits as a result of this recession, it means that businesses — especially credit card issuers and other financial companies — will have to change the way they define success.
While I admire this woman for fighting back again BofA and getting her interest rate reset, the debtors really need to stage a revolt against themselves, and pay off their debts and stay out of debt. Get rid of those credit cards and the easy money mindset.
Applying the same logic to the banks, they never should have recieved bailouts and thus should have died and freed us from the debts. You logic is one sided.
I agree with what Anne Minch did. I think we should form a debtors revolt movement. Maybe if a large number of people stopped paying their credit cards the banks will stop raising their rates. In addition, I am furious that they are raising our rates while they are giving out bonuses this year to the tune of 22 billion dollars to executives at Bank of America and 30 billion dollars to executives at Citibank. And they took our taxpayer money for a bailout!!!
I have had several credit cards with considerable balances, however a couple of years ago when my interest rates were raised with no reason(never late or missed payments) I used the “OPT OUT” option to prevent the raises in interest. It worked only temporarily and soon even though my payments were still current the rates were increased. Then my credit rating was lowered from as I recall 720 to only 658. I only discovered this today when I openned an account at a credit union to close all my bank accounts. My home, boats and cars are all paid without mortgages. My retirement income is enough to pay all my debts and pay for my daughters tuition and housing in college. She will graduate without debt next year. Therefore today I notified Barclay Bank I was suspending on my JUNIPER card debt until the interest rate was reduced to the amount I originally agreed raised to 23.24 per cent now. Of course, I called one more time today before this action. Credit is nolonger necessary for me to sustain my quality of life as I am 73 soon to be 74. I was taught growing to “ask for what I want and pay for what I get.” This high interest rate was and is unjustified. My retirement and Social Security checks will hereafter be mailed directly to my home not directly deposited because in Texas they could only levy on my bank account, therefore I want have one any more. If we all fight it can be corrected.