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(MN Daily)   Since people are apparently too lazy to read their credit card agreements themselves, Sen Ron Wyden (D-fault) proposes "five star" rating system   (mndaily.com) divider line 24
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510 clicks; posted to Business » on 03 Dec 2007 at 5:51 PM (7 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



24 Comments   (+0 »)
   

Archived thread
 
2007-12-03 02:27:52 PM  
Subby, Nobel laureates in economics can't understand those agreements. You fail.
 
2007-12-03 02:36:33 PM  
"FIXED RATE 7.9% FOR LIFE!"

This rate is subject to change at any time at the discretion of Bank of America.


That's what my last pre-approved application stated in clear black and white.
 
2007-12-03 03:25:31 PM  
Instead of front and back, three page, 6 point print a bullet point paper clearly defining the terms would be nice.

/dreamer
 
2007-12-03 03:59:56 PM  
I got a credit card from capital one and they laid everything out pretty clearly in terms of interest, grace period, etc in their application. It's the only credit card I have and its a 19.5% interest rate which keeps me from spending more than I can afford.
 
2007-12-03 04:37:50 PM  
The problem isn't disclosure, it's the federal preemption of most state anti fraud and deceptive act laws, coupled with the utter lack of meaningful regulation at the federal level. Wyden oughtn't waste his time with this since it won't get past the inevitable Republican filibuster.

If he's going to push something forward the (I think it was) Dodd bill that bans universal default.

OBTW blow me, dumbassmitter :)
 
2007-12-03 04:40:26 PM  
5 star system?

Count the number of stars (asterisks) that are used to indicate exceptions.
 
2007-12-03 05:07:57 PM  
I have neither 5 hours of time, not the unlimited access to an attorney, that it would take to fully read and comprehend a credit card agreement. Hell, the privacy policy alone now takes a good hour to get through...
 
2007-12-03 06:01:13 PM  
Whamdangler: "FIXED RATE 7.9% FOR LIFE!"

This rate is subject to change at any time at the discretion of Bank of America.


That's what my last pre-approved application stated in clear black and white.


I have a 7.9 fixed BoA card that I've had for 4 years and the rate hasn't changed.
Unless you fark up, you should be fine.
 
2007-12-03 06:25:02 PM  
Pay your bill in full and on time each month and it doesn't matter what the terms are (unless you were stupid enough to sign up for one with a yearly fee.)
 
2007-12-03 06:39:19 PM  

FTA:
"I am also going into a field where I won't have to worry about my finances,", Kaumer said.


Ah, optimists...

 
2007-12-03 07:09:54 PM  
Eh, I just use the credit card numbers I sniff from insecure wireless networks, what me worry?
/I kid, I kid
 
2007-12-03 08:36:12 PM  
flaEsq: The problem isn't disclosure, it's the federal preemption of most state anti fraud and deceptive act laws, coupled with the utter lack of meaningful regulation at the federal level. Wyden oughtn't waste his time with this since it won't get past the inevitable Republican filibuster.

At this point, just about anything that isn't a post office renaming is going to get filibustered or vetoed. I'd rather Congress not take a yearlong vacation (and I don't want to hear a word of 'but then they can't hurt us boo hoo').
 
2007-12-03 10:10:24 PM  
I have a solution to this problem: don't get a credit card.

If your response to that statement is something incoherent about mortgages then you fail at personal economics.
 
2007-12-03 10:18:28 PM  
mobombhead: Pay your bill in full and on time each month and it doesn't matter what the terms are (unless you were stupid enough to sign up for one with a yearly fee.)

Unless you read the statement carefully every month and catch it when they change the due date. Also, most people spend more when they use a card, so you will probably get screwed even if you pay it off every month.
 
2007-12-03 11:28:18 PM  
Rapmaster2000
I have a 7.9 fixed BoA card that I've had for 4 years and the rate hasn't changed.
Unless you fark up, you should be fine.


Sure, or your CC company farks up an automatic payment, or has a nasty habit of losing checks, or changes the due date without warning.

How about we avoid the credit cards, stop living on next month's income, and actually have some fiscal responsibility?
When you use the CC, even when you pay it off and incur no charges ... you are spending money you don't have yet. This leads to more spending [statistically], and makes it harder to live on a budget. On top of those concerns, you are helping to prop up a dishonest industry, and putting your finances in the hands of a cubicle rat who may or may not be trained/educated.

Read your agreements carefully, look for a "universal default clause" and consider the implications. A clerical error on your credit report can hose your rates, re-activate waived fees, or even get you dropped by the card company.

Explain how your credit card is better than cash again, please.
*It isn't the airline miles / reward points / hookers&blow every $5k spent ... more than half of CC rewards go unclaimed, and most are generally worthless anyway.
*It isn't the "invest the difference" game, because the spread you may make on one month's investing is chump-change ... and nobody actually does invest the difference.
*It must be the "magic swipey instant gratification thingie" factor. There is a genuine magical feel to getting something and being able to tell yourself "I'll pay for this later".

Of course, TFA shows the really sad side of the issue, most US Americans can't be bothered to read beyond the front of the offer envelope, and the CC companies don't bother to verify much of anything on the applications ... so morons get cards and charge a bunch of useless crap they can't afford, and then turn around to point their cheeto-stained fingers at the Gubbermint as if it is the role of an elected offical to keep them from pissing away their check from Wal*Mart to pay Providian's collections department.

And these broke, foreclosure-ridden, card-carrying, balance-surfing asshats BREED and VOTE ensuring the population gets dumber every year.
 
2007-12-04 12:40:23 AM  
For the amount of time most folks spend on Fark, they can research and learn about these terms themselves to make an informed decision. But, we'd rather be entertained than take responsibility.

Don't do the crime of you can't do the time. Don't get a credit card if you can't deal with it.

/Seriously considering giving a class on credit card terms and statements
//For a fee, of course
 
2007-12-04 04:55:48 AM  
wombatsrus:
I find your idea intriguing, and would like to subscribe to your newsletter.
Scratch that, I would like an employment application to teach in this school of financial responsibility ... do you offer flexible hours?
It really is an education problem, when you boil it down. The saddest part is that you can get out of public school in this nation without the ability to balance a checkbook.
 
2007-12-04 05:08:28 AM  
wombatsrus: For the amount of time most folks spend on Fark, they can research and learn about these terms themselves to make an informed decision. But, we'd rather be entertained than take responsibility.

Don't do the crime of you can't do the time. Don't get a credit card if you can't deal with it.

/Seriously considering giving a class on credit card terms and statements
//For a fee, of course


While I agree with everything you've posted (and am late to the party) I don't see the harm in simplifying it.
 
2007-12-04 09:37:12 AM  
LeroyLeroy: Eh, I just use the credit card numbers I sniff from insecure wireless networks, what me worry?
/I kid, I kid


Too much effort, you should be pulling new and improved, pre-approved, and marked with stars mail offers out of trashcans.

/Carlin.
 
2007-12-04 10:06:02 AM  

Despite the sarcastic headline, I think this is a great idea.

The 'agreements' are legal contracts, written by lawyers, and often are intentionally confusing.

People should not have to hire a lawyer to explain the contracts to them, they should be simple and easy to understand.

If they insist on making them confusing, we need a simple way to understand which ones are horrible, evil things, and which ones are just obnoxious and rude.

In fact, I think this should be extended to ALL EULA's.
 
2007-12-04 10:11:38 AM  
bigfatdave: Rapmaster2000
I have a 7.9 fixed BoA card that I've had for 4 years and the rate hasn't changed.
Unless you fark up, you should be fine.

Sure, or your CC company farks up an automatic payment, or has a nasty habit of losing checks, or changes the due date without warning.

How about we avoid the credit cards, stop living on next month's income, and actually have some fiscal responsibility?
When you use the CC, even when you pay it off and incur no charges ... you are spending money you don't have yet. This leads to more spending [statistically], and makes it harder to live on a budget. On top of those concerns, you are helping to prop up a dishonest industry, and putting your finances in the hands of a cubicle rat who may or may not be trained/educated.

Read your agreements carefully, look for a "universal default clause" and consider the implications. A clerical error on your credit report can hose your rates, re-activate waived fees, or even get you dropped by the card company.

Explain how your credit card is better than cash again, please.
*It isn't the airline miles / reward points / hookers&blow every $5k spent ... more than half of CC rewards go unclaimed, and most are generally worthless anyway.
*It isn't the "invest the difference" game, because the spread you may make on one month's investing is chump-change ... and nobody actually does invest the difference.
*It must be the "magic swipey instant gratification thingie" factor. There is a genuine magical feel to getting something and being able to tell yourself "I'll pay for this later".

Of course, TFA shows the really sad side of the issue, most US Americans can't be bothered to read beyond the front of the offer envelope, and the CC companies don't bother to verify much of anything on the applications ... so morons get cards and charge a bunch of useless crap they can't afford, and then turn around to point their cheeto-stained fingers at the Gubbermint as if it is the role of an elected offical to keep them from pissing away their check from Wal*Mart to pay Providian's collections department.

And these broke, foreclosure-ridden, card-carrying, balance-surfing asshats BREED and VOTE ensuring the population gets dumber every year.


Thanks for the tips. For you see, I am an illiterate retard who needs help in understanding finance from some paranoid nut on the internet. Kudos to you good sir!
 
2007-12-04 10:15:13 AM  
I believe in personal responsibility. Don't spend more than you make.

That said, CC companies play some really dirty tricks. Why does everyone feel it is ok for them to be deceptive? Universal default is a scam. Rotating due dates are a scam; it's practically "entrapment"

I use CC's for online purchases and subscriptions only. I use a CC from my Credit Union; if you have one nearby, check it out. My Credit Union treats my Visa as a line of credit. If I want, cash advances are fee-free. No stupid $15 "convenience" charge to pay online, or other tricks.

I'm sure some of you Farkers are gaming the system, and more power to you. I don't have the patience or discipline to milk the 0% and Rewards cards. Plus, as someone mentioned, CC's can get me into trouble...
 
2007-12-04 10:15:35 AM  
bigfatdave: It really is an education problem, when you boil it down. The saddest part is that you can get out of public school in this nation without the ability to balance a checkbook.

I never had this sort of education when I graduated high school (or college), but somehow the concept of "my bank account says $XXX and my credit card bill will be $XXX - which is bigger?" never seemed to be too difficult of a concept.
 
2007-12-04 11:38:21 AM  
Rapmaster2000: I have a 7.9 fixed BoA card that I've had for 4 years and the rate hasn't changed.
Unless you fark up, you should be fine.


BofA from time to time sends me a rate change notification, which I have to mail them a paper letter to "opt out of" to keep my current rate.
 
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