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I'm glad I've never had a credit card.
So they **** up their mortgage holdings by creating a situation where it's cheaper for a home owner to walk away than even try to sell... and to "fix" their revenue problems, are going to do something similar to the credit card debtors.
Not only this, but they're admitting that their "business is good" bull**** used to pump their stock prices is outright lies. (As previously seen by IB's borrowing of billions from the Fed as "we're just trying out the new Fed window being open to us... we don't need the money... really... we don't. $4Billion please. Thanks Ben. Here's some crappy mortgage backed paper as collateral.") I'm not sure what it'll take for the stock market to crash, but they seem intent on taking it there.
Even as the Federal Reserve has cut interest rates, financial institutions have sharply raised rates for credit card customers -- even those who pay on time -- as they grapple with losses from other bad consumer loans.
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This month, Washington Mutual told some credit card customers that it was raising their rates by as much as 100 percent. Discover is lifting its penalty rate to 31 percent, effective May 1, and may apply that maximum to consumers who exceed their credit limit twice in a rolling 12 months.
Bank of America raised rates for some customers in March -- triple, in some cases, though spokeswoman Betty Riess says "it would be very rare."
All three institutions say they reserve the right to adjust rates when customers become higher risks. Keith Givens, a spokesman for Washington Mutual, also notes that the decision to raise some rates is "an indicator of overall deterioration in the economy."
As banks deal with tough business conditions, their definition of risk is evolving.
That's why even responsible consumers whose credit scores haven't changed are being hit, says Joseph Ridout, a spokesman for Consumer Action, an advocacy group.
Bill Hardekopf, CEO of LowCards.com, says the card comparison site is "seeing more aggressive fees come out, and issuers are quicker to change interest rates."
He notes that as banks lose money on mortgage loans, it's logical they would try to boost credit card profits. "If one end of your business is suffering, you look to the other end to pick up the slack."
To boost profits, some banks have also imposed higher fees on consumers for paying late, transferring credit card balances and withdrawing money from an ATM.
The danger for cardholders is that as some struggle to pay bills, steep rate or fee increases could nudge them toward default. Credit card delinquencies have been climbing, and overall consumer loan delinquencies are at their highest since 1992
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This month, Washington Mutual told some credit card customers that it was raising their rates by as much as 100 percent. Discover is lifting its penalty rate to 31 percent, effective May 1, and may apply that maximum to consumers who exceed their credit limit twice in a rolling 12 months.
Bank of America raised rates for some customers in March -- triple, in some cases, though spokeswoman Betty Riess says "it would be very rare."
All three institutions say they reserve the right to adjust rates when customers become higher risks. Keith Givens, a spokesman for Washington Mutual, also notes that the decision to raise some rates is "an indicator of overall deterioration in the economy."
As banks deal with tough business conditions, their definition of risk is evolving.
That's why even responsible consumers whose credit scores haven't changed are being hit, says Joseph Ridout, a spokesman for Consumer Action, an advocacy group.
Bill Hardekopf, CEO of LowCards.com, says the card comparison site is "seeing more aggressive fees come out, and issuers are quicker to change interest rates."
He notes that as banks lose money on mortgage loans, it's logical they would try to boost credit card profits. "If one end of your business is suffering, you look to the other end to pick up the slack."
To boost profits, some banks have also imposed higher fees on consumers for paying late, transferring credit card balances and withdrawing money from an ATM.
The danger for cardholders is that as some struggle to pay bills, steep rate or fee increases could nudge them toward default. Credit card delinquencies have been climbing, and overall consumer loan delinquencies are at their highest since 1992
Not only this, but they're admitting that their "business is good" bull**** used to pump their stock prices is outright lies. (As previously seen by IB's borrowing of billions from the Fed as "we're just trying out the new Fed window being open to us... we don't need the money... really... we don't. $4Billion please. Thanks Ben. Here's some crappy mortgage backed paper as collateral.") I'm not sure what it'll take for the stock market to crash, but they seem intent on taking it there.
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