Credit card companies are defending their predatory practices before congress. We have now come full circle. First, congress made it possible for the credit card companies to charge outrageous fees. Account setup fee, annual fee, participation fee, program fee, the list is endless. Some with interest rates as high as 34%. Additionally, if your credit report goes down a point, for whatever reason, your interest can double or even triple. Then congress revised the bankruptcy laws so that even declaring bankruptcy will not discharge credit card debt. That is to say the only thing that can wipe away credit card debt is death.

Several things I am unable to see. The most important point I fail to agree with is this. If
John Doe Public has bad credit then don’t issue him a credit card. Period. But on the other hand if John Doe Public has decent credit and has been making payments on time and as agreed, what is the point of raising his interest rate when his credit report drops a point or two? A credit score can drop if an account is paid off. A credit score can drop when you shop for a car and get too many inquires in a short amount of time. A credit score can drop because you have too many active accounts. It can also drop if you close accounts.

Moreover, I fail to see the logic here. John Doe Public loses his job and skips a couple of payments on his car (but not on his credit card). So the credit cards see where he is in a financial bind and instead of helping, they raise the interest rate thereby doubling or even tripling the payment. In other words “lets kick this person while he’s down”. Let’s not give him a chance to get back on his feet.

The same can be said for someone that breaks a leg or arm and cannot work for a month or two. So instead of maintaining the status quo, instead of working with the customer, the credit card companies raise the interest rate so high that default is guaranteed. So now comes the million dollar question; where does it benefit a credit card company to have John Doe Public on the street or in a homeless shelter?

If you feel strongly about this issue contact your congressperson and let them know. A complete list of the House Of Representatives can be found at this link
http://www.house.gov/writerep/ for your US Senators go here http://www.senate.gov/general/contact_information/senators_cfm.cfm