More On Bankruptcy & Credit Cards

Hello All: I found this in USA Today,,,I will post a portion of it...

"No doubt, the rush to bankruptcy is a serious problem, but the legislation is, at best, only half an answer. It reins in consumers but does nothing to force more responsible lending. A more balanced approach would curb the industry's most objectionable practices:

•Squeezing consumers. By the time some debtors end up in court, they may already have paid more money than they originally borrowed. Take Ruth Owens of Cleveland. In 1997, she started trying to pay off a $1,963 balance on her Discover card. By 2003, she had paid $3,492. Yet her balance, pumped up by fees and interest, had grown to more than $5,500. Discover sued, but last year a Cleveland judge rejected its collection demand, saying Owens was the victim of "unreasonable, unconscionable" practices. Discover said Thursday that the judge's ruling was "inconsistent with the law."

• Raising fees Late fees on some major credit cards have soared to $39 - nearly three times the average fee in 1995. Fees for going over a credit limit have climbed, too, often to $35 a month.

•Hiking rates. Several top issuers now hit consumers with "penalty rates" just below 30% - rates that would violate usury laws in a number of states. At that rate, a consumer paying $300 a month on a $10,000 debt would take more than 44 years to pay it off. Consumers are punished for everything from making one or two late payments to using too much of their available credit limits, even if they have paid on time.

Judy Reid, of Johnson City, N.Y., said her rate on one card nearly tripled to 29.49% recently, despite a good payment record. She said the issuer told her that something in her credit report triggered the increase.

Consumers saddled with onerous rates and fees may well be driven into bankruptcy. Under the bill moving through Congress, most won't find a haven there.

Reining in irresponsible consumers is a worthwhile goal - but only if it's coupled with responsible lending. In biblical times, those who made usurious loans were said to be banished from God's presence. These days, they are rewarded with record profits and new laws tilted in their favor. At a minimum, they deserve a plague of boils."

To the last sentence I say AMEN!...

Rooster