e-Help Report: Credit Card Bills Make a Turn for the Worse
If you're forced to depend on your credit cards but always pay the minimum, you might think you have things under control. But pay attention to that monthly statement. A huge change is underway.
A lot is happening before the new credit card law goes into effect in February. One woman, Bev, wrote us, saying, "I always pay the minimum amount on my credit card every month and the amount just doubled. Can they do that?"
We spoke with Steve Burman, the President of the Credit Advocate Counseling Corp in Manhattan's Chelsea neighborhood. Steve says credit card companies CAN take the minimum payment due and double it. Then, it's up to the consumer to deal with it. And that's not easy.
"That's a hard thing to budget," said Steve. "If you're paying $300 to $400 a month to your credit cards and that's now $800 a month. That's a big hit."
The other thing that's happening is people are seeing their credit limits lowered. Say your credit limit is $10,000 and you owe the full amount. Even if you pay it down to five thousand dollars, thinking you'd improve your credit score, boom! They can lower your credit limit to five thousand dollars.
Steve Burman gets so many calls, with people asking, "Why did my minimum payment increase and why did my credit limit decrease?" Steve explains, "The credit card companies are taking losses because of the new law and the restrictions and the onus that it places on them."
These are just two ways the credit card companies are trying to make up for those losses. For more information, visit Steve Burman's website at www.creditadvocates.org
Comments: 6
Hi Howard,
I have 2 credit cards. I rarely use them. I am using cash now, more than ever. The rates are ridiculous. My visa went from 16% to 20%. I do find them convenient sometimes, however, rather than pay the minimum, I usually pay it off. I do get some perks with the cards, but it's just not worth it anymore. I think eventually my cards will be cancelled, for lack of use. I will chose my poison and not be blackmailed into paying a greedy piper.
I have received many questions on the impact of the new Credit CARD Act of 2009. For consumers interested in a summary of the new legislation they can visit this link:
http://www.creditcardreform.org/pdf/final-CC-summary-8-09.pdf
About the credit card increase, what do u do if i can not pay the increase due to the fact that I have at least 5 credit card bills that are active. Do i file for bankrupcy or debt relief if i can't pay these bills. I am on a fixed income, and i recieve social security disability.
About the credit card increase, what do u do if i can not pay the increase due to the fact that I have at least 5 credit card bills that are active. Do i file for bankrupcy or debt relief if i can't pay these bills. I am on a fixed income, and i recieve social security disability.
I watch Suze Orman. I think she is very intelligent, quite a character, but she gives great advice. Of late, I cannot find the show ON THE MONEY. They seemed to have moved it. I would suggest these programs, especially, when you have a money, debt, or credit card dilemma. If you could afford a financial advisor, I would invest in one for at least a couple of appointments. If you have a lawyer or accountant that you know personally, that might help you too. Good luck dear.
Lee
Responding to a previous post, CACC is a non-profit consumer counseling agency located in New York City. Our agency can provide realistic solutions to credit and debt issues at little or no cost. Regardless of the end result, many consumers have found it very helpful to know clearly what options are available for debt reduction so they can make an educated decision of how to move forward.