Voices from Vermont and America on Credit Card Rip-Offs
On April 24, 2009, I sent an email to my Senate mailing list, the "Bernie Buzz". My request: Send me detailed information about how credit card companies are treating you and your family. Three days later, I had almost 1,000 responses.
Yesterday, I distributed a booklet to my Senate colleagues which reprinted a small number of them, demonstrating in often-heartbreaking manner the extraordinary greed and callousness of some of the largest financial institutions in our country. I have also read some of these testimonials on the floor of the Senate.
I hope you will take a minute to read these stories from Vermont and the nation. They offer a window into the outrageous behavior of credit card companies, and why we need fundamental reform of the industry. Here are a few examples:
I want to know why consumers are not protected in any way from these predatory lenders who were bailed out with my taxpayer dollars and then turn around and raises my interest rate from 7 percent to 27 percent because of "difficult economic times" for the credit industry. This is outrageous! I have not missed a payment and my credit rating is in the high 800's. How can they keep getting away with this?Donna,
Neptune, New Jersey
If any of these credit card companies have received any bailout money, I think it is outrageous that they are allowed to get away with their capricious rate hikes. I hope congress steps in and stops these practices before the Federal Reserve restrictions kick in next year.Don,
Miami, Florida
I own and operated a summer business in excess of 43 years. My business credit card was with Avanta at 7.9 percent for years. Last year my payment jumped about $400 per month - I thought there was fraud involved. Upon checking I found my interest had been raised from 7.9 to 28.8 percent. I always paid more than the minimum and always on time. When Avanta was contacted and asked why, I was told it's a floating interest. I asked to speak to a manager and was advised that's the way it was and they could do nothing to lower it. I got a line of credit loan from the credit union at 1 percent over prime, paid them off and shut down my business. After 43 years of business, it took usury to shut me down. I am seventy five years old and a vet. Go get them Bernie, it's time we had honesty in the banking system.Walter,
Poultney, Vermont
I have personally had 3 separate credit cards raise the APR to 29.99 percent - when I have paid my bills on time (Citicard, Chase and BofA). Then just last billing cycle, another card I am in perfect standing with doubled my APR - no apparent reason (Chase). I am shocked and livid by these absolutely criminal APRs. This should not be allowed and I believe the APRs should not only be capped, but that there should be a civil lawsuit where they are charged huge fines for pursuing such practices.Jennifer,
Los Angeles, California
I live in a small town in Vermont. I feel that the credit card companies need to have a ceiling on interest rates and fees. They are stealing from us. We pay for the bailout and we pay the interest increases. They must think we are stupid.
Anne,
Brattleboro, Vermont
We have had the problem with credit cards lowering credit limits with no warning and increasing interest rates for no reason other than "we raised the rates on everyone". We are trying to get our cards paid off but it is extremely difficult when the interest rates are constantly being raised and fees added all the time. One of our cards went from 9.9 percent to 19 percent, another from 12.9 percent to 27 percent. Many have clauses that if you are one day late the rate will go up to 30+ percent, even if your late payment was on a different card. And these are the same banks that have gotten billions of our tax dollars in bailouts!Ellen,
Stillwater, Minnesota
In my view, when credit card companies charge 25 or 30 percent interest rates they are not engaged in the business of "making credit available" to their customers. They are involved in extortion and loan-sharking. This is especially true at a time when the taxpayers of this country have provided many hundreds of billions of dollars to bail out Wall Street and when the Federal Reserve is making zero interest loans to these very same companies.
I support legislation which will increase disclosure and transparency. But that's not enough! In order to protect the American people and our small businesses, we must pass a national usury law and place a cap on interest rates. I have proposed legislation that would emulate the regulations that credit unions live under - a 15 percent maximum interest rate (which currently can go up to 18 percent under exceptional circumstances). If credit unions can grow and prosper with a 15 percent cap, so can banks.
To send the senator your own credit card testimonial, click here.
To read Sen. Sanders' booklet, click here.
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If you don't need credit to buy a house or a car soon, here is an option that many people with good credit may not have thought of: STOP PAYING. The tactics that banks are using are immoral and should be criminal. If you give in and keep paying, it is only going to get worse. They will know that they can pull anything and you will continue to pay.
will my credit be destroyed?
Yes, short term if you choose to rebuild. Option #1 bankruptcy. It is harder but still possible to get your debts completely wiped out because congress (Dems included) sided with the banks who give them the campaign money. Another option is to let the credit card accounts severely default and then make a settlement offer. Start at 20%. There are many debt settlement companies charging for this service but you can do it yourself.
If you only have one card that is robbing you and you want to keep your other one, call the bank that is treating you fairly and explain the situation and that you would like to continue to do business with them but that you can not have your rate go up when you default on the other card or you will not be able to pay them either. This may not work because these companies make it very difficult to talk to anyone with decision making ability. As to speak to a manger from the get go.
cont...
Once you have ALL the debts wiped out or ALL of them are settled, then you can rebuild your credit by starting off with a secured credit card, or maybe its best to just live life and not deal with these crooks again. Do you homework, know your risks and do what you have to do. We still do not have debtor’s prisons so it won't be all that bad. You can't rebuild your credit if there are still negative items outstanding.
There have been former presidents that have declared bankruptcy and I hope we can all agree in these times this is not "business as usual" so I don't want to hear about how this is an immoral strategy.
Its time we as Americans unite against multinational and immoral corporations and say no more.
An example needs to be made by the government, Lock-up all the CEO;s of AIG, Credit card company's, Banking , Insurance, Healthcare, and let these clowns "rot" behind bars, throw away the keys, and make it very clear to the next clowns as well. Seize all of them and classify them as "Enemy Combatants, their not entitled to a trial.
I'm with you lobearoo, unfortunatly thats not the way it usually works.
If you look at the Globlization of Indonissia , Peru, Nicaurauga(spl) Argentinia, China , Russia,
You will find that when Global / Privatizeation/ Neo-liberalizm/ International /big Banks start taking over, it is the opposition that is arrested .
Not the CEOs of international banks and corporate raiders that are busy looting the country.
You will find that an Oligarchy is formed. Big Banks/Big Business take over the Plotics of the country ( Sound familiar?) and reduce the labor force to serfdom.
In all of the named countrys the ones who opposed the ruling Oligarchy were branded as Leftist,Comunist, Terrorist (sound familier?). They were attacked, civil rights were suspended , Martial law instituted, anyone objecting were beaten, arrested or killed. some actually had trials before being killed.
In the last elections the people of the US regected the bush era Privatizeation and corportization he represented.
Have you seen ANYTHING going our way?
We will get real change when people finally band together and stop paying their credit card bills and their property taxes. JUST DON'T PAY. And if they threaten you, threaten them back.
Sorry, but I don't see where property tax (which goes for local needs) and credit card company abuses (which are pure greed for obscene profit) are the same thing! And threaten them with what?
Personally, I do not use credit cards, but that is after getting some of their abuse a long time ago. That is my "threat"--take your card and put it where the moon don't shine. I keep a cash stash on my debit card and live within my means. It works and makes me think about wants vs. needs.
If I don't pay my property taxex what pays for Police Protection, Fire Dept, road work ect?
The day I received my finalized bankruptcy papers, I also received in the mail an unsolicited credit card with a credit line of $500. It is really sick. I threw it away and have not used a credit card since and have really been quite happy and able to function in this society. People should unite and strike and let all these credit card thieves know we are not going to remain enslaved this way any longer.
This really says it all and found at the bottom of this page.
Anonymous Bank Card
Get Your Anonymous Bank Card Open an Account Online in 8 minutes
www.Capita
Thank you Bernie.
Credit Card Companies are beginning to act like LOAN SHARKS. Tony of the "Sopranos" would be jealous.
Before people take out credit cards they should read very carefully the contract before signing it.
Once they have signed the contract, there is not much they can complain about or much recourse
for them.
And who can actually read that contract? They are thieves and they pay our government officials to keep on stealing from us, then ask for a bailout on top of it all. Read the constitution if you want to read something.
Sadly you are not seeing clearly how much of the situation developed. Millions of millions of people from university professors, judges, police, teachers, factory workers, politicians to those at the age of 18 could get a credit card and buy their dreams today and pay tomorrow.
Tragicly a large % did not have the wisdom or disipline to understand their dreams and the costs of buying today and paying tomorrow.
Now the collectors have arrived and it is time to pay the piper for yesterdays' fun.
It has been a terrible lesson though the next generation hopfully will be wiser.
A friend and his wife stopped paying all thier credit cards.
Invested all the money they would have paid the credit card companys in the stock market thru an online service.
They then accepted the calls from the credit card companys and collectors.
They agreed to pay $0.30cents on the dollar to settle all thie debt.
They even invested the stimulus check in the market.
Just a little day trading and they have turned $3,000.00 into $11,000 in only a few weeks and soon they will be debt free !
.
or broke....
It's great to be frugal & all, not use credit cards except to pay them off
every month. 'Empathy', though, is understanding that it doesn't always
work that way, and sometimes a quick trip to the emergency room or
a busted pipe or a leaky roof get in the way of ones best intentions.
Is there some good reason why banks always have to take advantage
of that?
As for the medical-cost aspects of this, it'd be most effective to put in
a government plan that provides low interest loans to cover such expenses.
Our comment to Sen Dodd's recent Article http://www
NOT TOUGH ENOUGH!
What happened to all our usury laws from yester years?
Legislation must contain strong cieling on the kind of interest that can be charged. What risk assessment justifies 20+% and 30+% .... interest rates? $39 late fees .... It is the kind of predatory lending in India that just recently led to the mass suicide of 1500 farmers ....! Before anyone goes after those Somali pirates abroad, we need to go after the credit card industry (banking industry in general) at home here in a very tough manner.
The people are behind the Administration on all these issues, no loosey-goosey with the banking industry. It is understandable that in order to shore up the economy on the spot, this industry has to be tolerated to a degree. However, same cannot translate into even remotely alloweing it to ever return to business as usual ,,, The venomous and toxic kind of Capitalism developed in this country, to the detriment of 98% of its population, is not any America anyone recognizes or wants.
Indeed, have we taken leave of our senses? America used to be such a reasonable, enlighteded, just. ... country for all across the planet, now and here it has emerged to cannibalize its own people????????
Credit cards are the new American drug. If the bank raises your rate simply don't use the card. it's called choice. Americans are addicted to their discretionary purchases. Americans think they're entitled to cell phones, cable and the latest designs. Blaming the credit card companies is the same as blaming Betty Crocker for your obesity because they make the chocolate cake.
That's what some of the companies said. I got something in the mail from a company saying that if I didn't like their new terms to give them a call and they'll close my account.
Unfortunately circumstances sometimes limit choices people have like loss of health care and big medical bills, big car or house repairs that can't wait - job loss or work hour cutbacks etc. If family members have a life threatening ailment is your spending "discretionary"? If the septic tank system needs replacement do we hold off using it until we have the money?
The fact that a bank in the small print can jack up interests rates from 7% to 34% without warning during a depression economy might be "legal" but is neither right nor smart. The situation screams for regulatorary controls and replacing the current rogues in office with ones more responsive to their citizens.
You make a good point, but the alternative is to live within your means and save real money for those things rather than charge them. On healthcare, obviously, we need a system that covers everyone so that no one goes in serious debt or bankrupt for it. We have one bathroom, one car, push mower (much cheaper to maintain and good exercise), no snow-blower, or dishwasher or dryer (have a nice clothesline, though). We live on one modest income, raised a family and enjoy life. We eat mostly at home, but splurge on special occasions. We grow a large garden on our city lot and have three chickens. We have fruit trees and can in the summer. Most clothing comes from the thrift store and we knit our sweaters. You will probably laugh, but we feel very satisfied.
"We have a system of legalized bribery..!
Dr. Zbigniew Brzezinski
Someone please explain predatory lending. Sounds like a creditor creeping up in the grass and when he gets close enough he starts to chase you and once he catches you he devours you against your will. I haven't ever seen anyone given a credit card against their will...I do see a bunch of folks posting here that think they should be given a credit card on their own terms against the creditors' will. Sounds more like predatory consumption.
Its lending that is deceptive in its payback terms (or at least, obfuscates the 'downside' in a block of legalese).
Sure, some people are reckless in terms of their use of credit, but others took the credit line for use for needed/large ticket items (furniture set, car repairs, orthodonist bills, etc) and thought they understood the policies..
Some people's credit woes are their own problem, for sure. There is such a thing as being a good-faith, responsible lender, however--and that breed appears to have been rendered extinct by the predators.
Good points. However, we must be very careful with our money. Also, the answer is not to get government to jump in but to stop doing business with bad-faith, irresponsible lenders. They do understand that when no one applies for credit something has to change.
all of your comments here really express a narrow minded and insensitive point of view. I'D LOVE FOR YOU TO EXPERIENCE WHAT IT'S LIKE TO STRUGGLE DUE TO CIRCUMSTANCES BEYOND YOUR CONTROL. you clearly need some enlightenment ...and HUMILITY. what a pompous *ss.
That's a lot of assumptions for a self proclaimed straight shooter such as yourself to spew.
So, if you got hired by a company for say, $60,000 per year and the job description was specific, yet every few months or so they would decide to pay you less and less and ask for more and more work done outside your scope, you'd be OK with that?
Or, you agree to lend your neighbor your mower if they promise to mow your lawn, but they never do - you'd be ok with that?
It's simply a matter of trust.
We agree to pay our cards on time. We agree to contact the companies if we believe there is any fraud on our accounts. We agree to the initial interest rate (which isn't clear until we "get approved") and to the fees, etc.
Yet, even those in good standing are punished by higher interest rates, frozen or reduced limits, and exorbitant fees.
The assumption is that if you are late or go over the limit, you'll be "punished", but that's not so. And ironically, your past history of credit means NOTHING to these banks. They will smite you faster than you can say "denied".
Read the fine print? Sure, if you have a good accountant and lawyer available.
It's the changing of the terms at their discretion that is unconscionable.
Thank you for visiting us from your far-off planet. Here on Earth teens are enticed to use credit cards and become addicted to them just like the credit card companies want them to be. Adults are enticed with low beginning interest rates which quickly rise to unpayable heights. Even if you only keep the card for an emergency, that emergency often arises and you become trapped. Then even if you pay your bill faithfully one glitch or change in bank policy can change everything and you are behind the eight ball. It must be nice to live on your planet where these conditions don't exit. What is the name of your planet anyway?
hank you for visiting us from your far-off planet. Here on Earth teens are enticed to use credit cards and become addicted to them just like the credit card companies want them to be. Adults are enticed with low beginning interest rates which quickly rise to unpayable heights. Even if you only keep the card for an emergency, that emergency often arises and you become trapped. Then even if you pay your bill faithfully one glitch or change in bank policy can change everything and you are behind the eight ball. It must be nice to live on your planet where these conditions don't exit. What is the name of your planet anyway?
What if the govt were to increase the interest rates that the bailed out banks have to pay back? Wouldn't it be perfect Justice to see them hit with the same tactics that they insist they have to use?
Where are the class action suits against the predatory lenders?
Why is the socialist in the Senate, the only one that seems to have his head on straight?
Ho hum....
I like your idea!! Would just add that their credit limits should arbitrarily be lowered, w/ NO notice, and mandatory arbitration clauses inserted into their contracts so that they are prohibited from seeking relief in the courts...p
Well, then the first step would seem to be class action suits disputing lenders' assumed right to forbid "seeking relief in the courts" by forcing arbitration, instead.
They can't be allowed to make all the rules!
As Walter from Poultney said so well,
"Go get them Bernie,"
It's long past time
"we had honesty in the banking system."
Go get 'em.
This recession will turn into a depression with a big D if this piracy isn't stopped. And fast.
So, er Bernie, let me ask, why did Congress repeal the law against usury back in 1990's? And why did Congress repeal Glass-Stegall? And why did Congress not regulate the "sub-primes"? And, why is it that the new legislation Congress just enacted won't kick in until 1 year from now?! And why are too many Democrats continuing to push for the continuation of right wing-nut bad ideas?!?!
Follow the money...it
My mantra for years.
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