Card Companies

I have a platinum MasterCard. I went over my credit limit because the card issuer said it did not receive my last payment in time to be posted. I use a postage meter, and the payment was sent to the company two weeks before the due date, for an amount that was triple the minimum payment.The company claims it did not receive my payment until a week after the due date. It slapped me with an "over credit limit fee" of $125, plus a late fee. When I called, the phone representative said that the company does not consider postmarks on envelopes, even if registered, as the date payments were received.

For most students, college is a time to learn. And for some, the subject is debt. Not the debt you study in an economics class but credit card debt. And lots of it.Credit cards are easy to get, easy to use, and -- as many find out the hard way -- easy to abuse."

FOR NOW, at least, Americans are getting their debts under control. The growth in new credit is slowing down, and more people are keeping their credit cards clean.Some 42 percent of consumers are paying their card bills in full each month, according to CardWeb in Gettysburg, Pa., which collects industry statistics. That compares with just 29 percent in 1992.In part, the high number of paid-up cards reflects a new relationship shoppers have with their plastic.Traditionally, credit cards represent true debt.

WASHINGTON -- With the number of personal bankruptcies soaring, the House Judiciary Committee considered a controversial bill yesterday promoted by the banking and credit card industries to make it more difficult for people to declare themselves legally broke.By defeating several changes proposed by Democrats, the Republicans in control of the committee signaled that they would pass the bill, probably today.The Senate Judiciary Committee is expected to consider a somewhat less strict version as early as today, and both houses could vote next week.

BGE's restructuring, utility deregulation are separate 0) mattersThomas C. Shaner of the Alliance for Customer Choice of Electrical Suppliers questions my view on the significance of a bill that would have amended an antiquated law banning Maryland utilities from forming holding companies ("Refusal to compete cost BGE its chance for holding company," May 24).The bill and electric restructuring are two separate issues that should be examined on their individual merits. By adding restructuring amendments to the bill in the last legislativesession, lawmakers demonstrated a disregard for a simple but pressing business matter and nearly compromised the complex electric restructuring process.

For most students, college is a time to learn. And for some, the subject is debt. Not the debt you study in an economics class but credit card debt. And lots of it.Credit cards are easy to get, easy to use, and -- as many find out the hard way -- easy to abuse."

This weekend, as I handed my credit card to the young person with a nose ring at a small shop in the mall, I couldn't help but think of all the people who are afraid to buy anything online for fear some weird hacker will steal their credit card number.Now the kid with a nose ring was probably an astrophysics DTC student at Georgia Tech, and the woman waiter with a nice tattoo you saw the other day probably is a wonderful person ` but my point still holds.There is a lot greater chance of credit card fraud in your everyday life than there is when you buy something from an established merchant on the Internet.

THE CONSUMER Federation of America, a Washington-based consumer advocacy group, released a study last week that found that Americans charged over $1 trillion on credit cards last year.Nearly one-third of the debt is being paid off in installments. It also estimated that Americans carry an average balance of $6,000.Are American living dangerously? Who is at fault for these high debt levels? Should the credit card companies be blamed, or it is reckless consumer spending?William "Tim" KeatingFinancial counselor, Rockville.

I'm a "deadbeat" - and proud of it. Credit card companies hate people like me. Ironically it isn't because I'm stiffing them on my bill, which is the normal definition of a deadbeat. No, it's only in the perverse credit-card world that someone who pays on time is a "deadbeat."In credit-card philosophy greed is good - it leads to debt. Model customers run up bills and pay in installments, with the high interest that makes the business so lucrative.Too many people have been gulled into believing that plastic somehow represents "free money."

A 33-year-old Howard County businessman is turning the nation's mountain of credit card debt into a personal gold mine.Five years ago, Bernaldo J. Dancel started National Credit Counseling Services (NCCS) on the kitchen table of his Columbia apartment. Today, he makes about $300,000 a year running a $27 million tax-exempt, nonprofit corporation that's about to move into its fifth new and larger office since 1992.County officials tout Dancel's operation as a prime example of economic development -- even as tax experts warn he is pushing the Internal Revenue Service standard of what it means to be a public-service nonprofit corporation.

I last wrote about America's abysmal savings rate. Now, the flip side: our even more crippling credit card debt situation. According to a recent study, in 2008 more than 91 million U.S. households, or 78 percent, held at least one credit card, with an average of 5.4 cards per household. Total credit debt as of December 2008 is $973 billion, with a household average of $8,329. Almost 90 percent of that outstanding debt is held by 10 creditors; Chase, Bank of America, Citi, American Express and Capital One (the company with those zany commercials)

Credit card issuers are using a host of measures to make sure customers make their payments and fees keep coming in, now that banks are feeling as squeezed as their financially pinched consumers. Some card issuers are clamping down on late payments and grace periods as they near new, stricter credit card regulations that go into effect in July 2010, consumer advocates say. Some lenders also are working out payment plans and, in certain cases, lowering interest rates for delinquent customers who are having a hard time keeping up with their bills.

Federal regulators have finally adopted new rules for the credit card industry - policies designed to keep people from getting hammered by soaring interest-rate increases on existing accounts. But the rules don't go into effect until July 2010, and that's much too long to wait. The new Congress and the Obama administration should find a way to expedite the changes, giving banks and other lending companies some time to comply - but not a year and a half. That's especially true since there are legitimate concerns that credit card companies and banks may impose higher rates and fees on many customers to make up for their losses in the sluggish mortgage market.

The Federal Reserve Board was poised today to pass unprecedented credit-card reform, which ultimately could reduce the amount that consumers pay in fees and interest. The Fed proposed regulations in May and has received more than 62,000 public comments since then. The revised regulations will be released later today, when the Fed takes them up for a vote, although they are expected to be similar to what was proposed earlier. If the Fed moves ahead with the proposal, changes expected for the credit-card industry include: * Card issuers won't be able to raise rates on outstanding balances unless it is a variable-rate card, a promotional rate is lost or expired, or a payment is more than 30 days late.

Americans aren't just struggling to pay their mortgages these days. Many families have accumulated staggering amounts of credit card debt in recent years, and growing numbers are falling short in their efforts to repay. Consumers have accumulated $900 billion in credit card debt, an average of $9,000 for every family with more than one card. The average interest rate on that debt is 14 percent, and the credit default rate is mounting, up 48 percent from a year ago, according to Moody's Investors Service.

Consumers are not just having a tougher time getting auto loans and mortgages. The credit crunch and weak economy also are taking a toll on credit cards. Maybe you have noticed that you're getting fewer offers for credit cards in the mail these days. If you have iffy credit, you might find it difficult to qualify for a card now. Or you may be able to get one only at a high interest rate. Even if you're not shopping for a new card, you might not be immune from the changes. Your card company might reduce your credit limit or cancel a card you don't use. "When the economy is contracting, when unemployment and default rates are on the rise, card issuers - as well as other lenders - go on the defense," says Greg McBride, senior financial analyst with Bankrate.

There is no leniency. Credit card companies and banks are worried that people are drowning in debt and will fall behind on payments. With home values declining and banks wary of handing out loans, outlets for escaping overwhelming debt are limited. Consumers are finding themselves caught. Card companies are getting tougher, sometimes canceling unused cards or raising rates seemingly for no good reason. And 30 percent of banks said in a recent Federal Reserve survey that they had tightened standards on consumer loans.

Sajid Chaudhry sells gasoline for a living, so with pump prices approaching $4 a gallon, you'd think he'd be celebrating. But the 10 stations he and his partners own in the Baltimore-Washington metro area aren't making them rich, as frustrated motorists assume they are. In fact, he says, profit for gasoline retailers can actually fall as gas prices go up, thanks to rising credit card fees, increased costs and intense competition for customers. The lucky ones make up for thin profits on gas by boosting sales of sandwiches, cigarettes and bottled water to motorists.

Credit cards are diabolically convenient. Having a card means you don't always have to carry cash. You can zip through payment without delay. You are relatively protected from fraud. And, should a transaction go awry, your chances of getting your money back are greater if you pay with plastic. But you're paying a high price for that convenience. The fees and rules associated with using cards keep getting more onerous and perplexing as plastic has become the preferred method of payment, even for purchases as small as a fast-food burger.

The Q: You're probably used to providing one or two forms of identification whenever you write a check to a merchant, but it seems more and more businesses are asking credit card users to cough up some picture ID, too. "If you refuse to show them your ID, they claim they will not sell to you," said Jon Smith of Baltimore. "I believe under the Uniform Commercial Code, if they display a credit card symbol (such as a MasterCard or Visa) showing those forms of payment are accepted and do not have a posted sign saying they require IDs to use your credit card ... that they cannot refuse selling to you as you have abided by all of their posted policies and have presented a valid form of payment for a product or service."