Credit Cards raising rates as high as 30%

If you have any accounts at any financial institution or any credit cards, you have probably received a mailing recently that has informed you that the fees and interest rates the institutions and companies will charge you in the future will change. It will be going UP!

Banks are raising fees for using an out of network ATM machine. Some overdraft fees are jumping to $45.00. Free checking accounts are going to be charged user fees. No one as yet has defined what that is, or what the fees will be.

Credit-card lenders, have been increasing fees and interest rates, raising minimum payments and cutting credit limits. Some have hiked interest rates as high as 29.99% or canceled cards altogether. Many card companies are going to impose a variable rate, based on the prime rate as reported quarterly in the Wall Street Journal, plus an additional amount for annual fees based on some formula the financial institutions have for raising your fees because they feel like it. And there is also a section in the malings stating that the new law allows you to "opt out" of a higher rate or an annual fee. However, if you do not agree with the fees and interest rate hikes; the company will cancel your card but you will still have to pay it off based on the new fees.

Supposedly, these institutions have to increase what they charge you, the person who pays their bills on time, because they have people who do not pay their bills on time or at all. HELLO...that's what T.A.R.P. dispersements were for - to cover the bad debts of companies from people who did not pay them. A number of these companies, such as Bank of America, Citigroup and so on, have benefited from T.A.R.P. dispersements. No one but the financial institutions know just how much money they received. To date, no federal or government agency can give a total accounting in dollars and cents of the money that was given to the institutions.

In an attempt to let you think that Congress was feeling your pain, they passed the Truth in Lending Act of 2009 which goes into force in February of 2010. It is suppose to curtail financial instituitons and credit card companies practices in the future from doing the same thing they are doing now - gouging the average person by nickle and diming you everytime you turn around.

It is because the Truth in Lending Act of 2009 will be going into effect that the instituitons are charging the costs to you now. Who would have thought that financial institutions would try to gouge you before the February deadline? Evidently Congress is just first waking up to that fact and has at least started to get moving on doing something about it.

Sen Dodd and other sponsors have two bills that need to get through Congress quickly.

S.1799 : A bill to amend the Truth in Lending Act, to establish fair and transparent practices related to the marketing and provision of overdraft coverage programs at depository institutions, and for other purposes.
Sponsor: Sen Dodd, Christopher J. [CT] (introduced 10/19/2009)
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills&docid=f:s1799is.txt.pdf

S.1927 : A bill to establish a moratorium on credit card interest rate increases, and for other purposes.
Sponsor: Sen Dodd, Christopher J. [CT] (introduced 10/26/2009)
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills&docid=f:s1927pcs.txt.pdf

The important part of Senat bill 1927 is in Section 2:
SEC. 2. MORATORIUM ON RATE INCREASES
During the period beginning on the date of enactment of this Act and ending 9 months after the date of enactment of the Credit Card Accountability Responsibility and Disclosure Act of 2009, in the case of any credit card account under an open end consumer credit plan—
(1) no creditor may increase any annual percentage rate, fee, or finance charge applicable to any
outstanding balance, except as permitted under subsection 171(b) of the Truth in Lending Act (as
added by Public Law 111-24); and
(2) no creditor may change the terms governing the repayment of any outstanding balance, except as set forth in section 171(c) of the Truth in Lending Act (as added by Public Law 111-24).

Send them an email and tell your reps in Congress to move their butts on this - like yesterday! Or you might just not have any money left to contribute to their 2010 campaign.