Jennifer Marks

Why pay on time? to be stabbed in the back again, and again.

Recently one of my credit cards dropped my limit. - No big deal never used card for purchases it was the "holder" of my debt with a "fixed rate". In hind sight that should have been a red flag. One statement later - my interest rate was increased on the same card. Was I being targeted? Had I missed a payment? The nice customer service rep explained it was not me, it is a "reflection of the economy" and that many accounts have been affected.

I have read Suzie Ormond and listen to the Clark Howard. I kept my balance on all the cards under 80% of maxed out (limit) & made sure all cards were paid. Always pay the highest interest card FIRST and everyone else got the minimum. My lesson had been learned -- I knew if I fell into the over 80% category - they bank would pool me with the maxed out or delinquent accounts and all my terms would be changed.

Then shady got greedy; the credit card company dropped my limit so low I was almost maxed out and the following month, they could then doubled my interest rate.

Talk about kick a dog when it's down.

I have become a savvy person with my credit card over the last 18 months because I am trying to pay them off. The debt I created in my early 20's by moving too many times, shopping, lack of medical care, school - you name it, I charged it. I do not claim to be innocent-I have owned up to my debt - that does not mean I deserve to be taken advantage of.

I am not the only one on the banks S**t List.

Relaxing with my Sunday morning paper and coffee, there was my answer in the Work & Money section of the N & O "Banks had time to make changes". Mary Cornatzer had an article talking about Congress' new bill to improve credit card regulations and the February deadline!!! Ugh.

Then it hit me - the customer service rep that said "reflection of the economy" really meant - "hey lady --we have to charge you up the wahzoo now because the rules change in February"

There must be something I can do besides just wait and watch the bills spike. Pay it all off in one swoop was not financially possible. Google to the rescue- Articles from both Bloomberg & Time set me straight, I am not being targeted - we all are.

• A Brief History of Credit Cards
• How Banks Plan to Limit Credit Card Protections
• Credit Card Bill Playin Fair Not Foul

The changes in the banking industry affect all areas of lending - truthfully a credit card is a loan. Similar to the improvement in the mortgage market, new credit card regulations have been created to prevent the predatory attacks within the banking industry.

To name a few:

• You will have to "opt in" to over limit transaction on your debit or credit card. Yes, you may get declined at the register or the pump.
• You will have to receive a separate notification changing the terms to your account.
• Interest rates cannot be increased unless you blatantly do not pay ( 60 days+ late)

(More examples Check out this article Stop Buying Crap )

I agree it does need help - The bill will help protect the public from banks that randomly change the terms of written agreement to meet there own financial goals. No other industry allows you change the terms to a written agreement or contract at will.

In May the card act was passed and instead of making the changes, the credit card companies spent the past few months raising interest rates and adding new fees. If purpose of the regulations was to help protect the public why were the changes not IMMEDIATE. Basically, Congress told the crooks we will raid you in spring so start behaving now. Over all I think these changes will be for the best, I am just concerned about HOW & WHEN it will be implemented.

This slack action is costing me money I do not have. My minimum before these improvements totaled $275/mo now the total over $500. This is money I could have used to build by business or pay down the balance. I know I am not alone; many Americans have lived beyond their means for too long. I wonder how many people will just choose to be cash only, or give up because they cannot afford to make even the minimum payment.

I have not made a credit card purchase in 18 months. Cash & carry is tough. As a real estate agent I am lucky - I can control my expenses more easily than some because I have no employees to pay. These changes have caused me to grow more slowly and definitely more calculated. Other small business' may not be as lucky, without a line of credit and spiking interest rates many may be force some to shut their doors. How will these changes effect buyers, sellers and credit scores? I guess time will tell.

READ YOUR STATEMENTS THIS CAN HAPPEN TO ANYONE WITH A BALANCE.

I will get you the full details once I see that it has updated on the IRS site. In the mean time if has PASSED the Senate and is on the road to EXTENSION.

Dear Mr President -- Please Sign!!! A short term extension sound like a great idea. Buyers still need to Act Now or loose this opportunity.

RISMEDIA, November 6, 2009-After the Senate gave final approval last night without a dissenting vote, the House of Representatives voted overwhelmingly this afternoon to pass legislation containing an extension and expansion of the home buyer tax credit, completing Congressional action and sending the tax credit to President Obama for his signature, possibly as early as tomorrow.

The $8,000 homebuyer tax credit for first-time buyers, due to expire in 25 days, will be extended through April 30 of next year and buyers will have an additional two months, until the end of June, to close. First-time buyers who are in the process of making a purchase will no longer need to worry about qualifying for the $8,000 credit if they close after the November 30 deadline. The new legislation increases the income limit for couples with income up to $225,000, a nearly $55,000 increase above the level in existing law.

For the first time, the new legislation makes buyers who already own a home eligible for a credit. A $6,500 maximum credit will be available to existing homeowners who have lived in their current residence for five of the prior eight years. The legislation limits eligibility for the existing homeowner credit to homes worth $800,000 or less.

The legislation takes effect December 1 and is not retroactive. Both credits are available only for primary residences, not second homes or investment properties.

In the House debate, Speaker Nancy Pelosi (D-Calif.) took the floor to say the home buyer tax credit was helping a new generation of Americans live out their dream of home ownership and financial independence. Debate on the home buyer credit was overwhelmingly positive and the legislation passed 403 to 12.

However, several leading economists have voiced concern about the $16.7 billion cost of the credit and the wisdom of spending up to $400,000 per home buyer to stimulate real estate sales and White House support for extending the credit has been lukewarm at best. However, it is virtually certain that the President will sign the legislative package, which contains an expansion of unemployment benefits as well as the tax changes.

In the Senate, the homebuyer tax credit was amended to a bill expanding unemployment benefits by 20 weeks for those who have exhausted their benefit. The latest unemployment numbers are due out tomorrow and Congressional leaders are rushing the unemployment bill to the White House so that the President can show compassion by signing on the same day more job losses are announced.

The legislation included provisions added to address complaints of fraud. The Internal Revenue Service is given greater authority to oversee the process to root out fraud, and provisions are added in response to past abuses of false sales or underage buyers. An investigation by the Treasury Department's Inspector General for Tax Administration found that more than 580 children, some as young as four years old, had received $627,000 in first-time home buyer credits. The IRS has identified 167 suspected criminal schemes and opened nearly 107,000 examinations of potential civil violations of the first-time home buyer tax credit.

The legislation also contains a provision supported by the National Association of Home Builders which will help larger companies strapped for cash with net operating losses (NOL). Ordinarily these companies can carry back these losses for only two years to qualify for a tax refund. The provision would make this process extend the carry-back to five years for either 2008 or 2009. The tax break will now apply to losses in either 2008 or 2009, and the income cap will come off.

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