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Thursday, November 30, 2006

Ambush creditors

Some credit card companies have really turned into ambush creditors. Elizabeth Warren provides some detail:

Over the past twenty-five years, the credit card industry has grown like the blob, sucking up money from working families across the country. New tricks, traps and tickles have left millions of families mired in debts they may never pay off. Even as the industry "innovates" with cross-default clauses, double-cycle billing, multiple low-balance cards, and a dozen other practices designed to deceive, there hasn't been a whiff of new regulation.

Not content with the profits available by providing a convenient service, the credit card industry turned into debt predators. Not content to make profits by charging exorbitant interest, the industry invented a series of traps and fees to extract the highest costs from those with the least ability to pay.

Ambush creditors -- intelligently designed to prey on the weak to pay dividends to the strong.

3 Comments:

The other thing that happens is that once an account is too old to be collected, the bill collectors will try and contact the debtor, and if the debtor takes some action, i.e., agreeing to a payment schedule or something like that, the account becomes active and collectable again.
And yet, no one would consider talking to a lawyer about protecting themselves because lawyers are a bunch of "crooks." and "they'll charge me."

By Anonymous, at 10:50 AM

There is such as thing as the fair debt collection practices act that has a fee shifting provision for violation.

Its scary when the credit card companies can ram down "reform" over a bankruptcy system that was not broken to begin with. To add insult to injury the credit card companies have erected numerous barriers to being considered broke under the law and able to liquidate.

By Anonymous, at 10:12 PM

Always good to hear from those with actual experience.

By Hammer, at 7:25 AM