The recession had a immense effect on the credit card industry, which has caused billions of dollars in losses with a huge increase in the number of people who can’t pay their bills because of a sudden job loss or other money crisis. That causes another ripple effect even on a large group of credit card customers who have always paid their bills on time.
Bill Hardekopf(chief executive officer of lowcards.com) has added “The game has changed dramatically. If you do anything — and I mean anything — to show that you’re a higher financial risk right now, you will, the next month, get an increase in your (annual percentage rate) or a decrease in your credit limit.”
In the period from 2007 - 2008, credit card service providers increases their interest rates on nearly 1/3 of all their existing cardholder accounts- according to the Pew Safe Credit Cards Project, which collects data the banks provided about new credit card regulations.
Within the first three months, the rate of interest for bank-issued credit cards increased to 1.32 percent, from 1.19 percent a year ago-added TransUnion,from 27 million-credit card transaction database.
A new set of regulations, known as the Credit Card Bill of Rights, will get into effect from next year , which will make a number of changes particularly protecting customers from sudden unexpected deductions, and risinge interest rates without proper notification.
The techniques credit card providers using to compute risk depends upon various things, but experts say a minor change of your payment-pattern can be causing a sudden increase of interest rates, or decrease in your creditlimit . Only making the minimum payments can also be a red flag to credit card companies .Using your credit card to buy second-hand commodities or for gambling/betting can also be harmful for your credit score.so think wisely, do well.
0 comments:
Post a Comment