November 5, 2009

• Becoming Savvy About CC Fees, Pt.4
    It's all up to you.

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  As credit card companies continue to face excessive losses, you can expect to find more confusing fees hidden in the terms and conditions of account contracts. Their track records speak for themselves. Additionally, as long as loopholes exist in regulatory legislation, lenders will justify charging these fees to increasing losses. However, in spite of the wailing by major credit card companies, some have reported promising numbers for October including American Express and Capital One. Experts, on the other hand, say this is only temporary and predict lenders will see another surge in credit card delinquencies and defaults. Any way you look at it, consumers can expect to more of these fees.

  Consumers have begun to fight back in a number of ways. Many have switched from credit to debit. Statistics show that American have increasing reduced spending over the last 12 consecutive months. Research also indicates that consumers have reduced credit card balances over the past year as well. It is also hoped that new reform legislation will bring some relief for consumers; however, lenders say it will do more damage than good by limiting available credit. However, what lenders don't want you to know is that if consumers continue to reduce credit card spending, the law of supply and demand takes over.

  The new credit card legislation is aimed at restricting the way lenders assess fees and requires them to write card account contracts with more transparency. However, these rules are not scheduled to become effective until February 2010. A group of lenders including Citigroup, Discover, and Capital One have also joined together to promote goodwill with consumers by launching the Help With My Credit program. The program is aimed at helping consumers that are struggling with making card payments. Meanwhile as the holiday shopping season gets underway, you could be tempted to swipe more than you can afford. The bottom line is; it's all up to you to make the right choice.

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