The Federal Government is talking about changing the rules on financial institutions and credit card companies to protect the customer. The uncertainty concerns the credit card companies. If you are considering getting an unsecured credit card in the future, you need to learn about the coming changes and how this will affect you.
Credit card companies will have new rules to protect the customers. They cannot charge just any fee anymore. The Federal Government is limiting the amount the companies can make a customer pay for all fees from a late payment fee, to an over-the-limit fee to annual credit card fees. Consumers like this. Credit card companies do not.
Since the credit card firms will not be able to charge all these very profitable (to them) fees, the only other way they can keep making the same amount of money is to raise the interest rate, and raise it a lot. The radio reported that a source at Fox News said one company has raised its interest rate to 80% APR!
A year from now, the credit card deals will be much different than what is offered now. Check the top 10 deals you have from credit cards. A year from now interest rates may be much higher. With the likely increase in interest rates, some consumers could see their credit card debt double or triple.
If you carry high balances on your credit card, I suggest you pay off the card and cancel it. This sends a message to credit card companies that we will not play their game. We will take our money and go elsewhere for a loan when we need one.
If you have several unsecured credit cards and are receiving offers from credit card companies offering 0% APR on those balances, take the offer. However, just remember that in 6 to 18 months when the offer of 0% APR expires, the rate will go up, way up. Read all the details of the offer before you switch.