Biden Administration Cuts Credit Card Fees

[iluvatar5150]

Credit card fees slashed for millions of Americans

The White House said President Joe Biden is committed to making sure "corporations are held accountable when they try to rip off Americans."

www.newsweek.com

Credit card fees will be slashed as part of new rules brought in by the Joe Biden administration.

According to a release issued by the White House on Tuesday morning, the Consumer Financial Protection Bureau (CFPB) has finalized a ruling that will cut the typical credit card late fee from the current average of $32 to $8.

The new rule closes a loophole in a federal law called the CARD Act, which allows major credit card issuers to charge increasing fees if individuals are late in paying off their debt.

 

[rambot]

Don't they know that this isn't going to help ANYONE?

Isn't their something else that could desuade them from doing something so helpful? If Joe's stuck, just have him ask Republicans; they're doing a great job of not helping anyone with anything ever....

 

[Fantine]

Wow! Consumer friendly laws!

Even someone on the (well-earned) verge of bankruptcy like DJT would approve.

 

[probinson]

Maybe in addition to reducing the penally for late payments, it would be advisable to understand why so many Americans are so far in credit card debt that they can't afford to make on-time payments in the first place.

 

[Handmaid for Jesus]

I learned a long time ago that credit cards keep you broke. I only have one and I keep it below a thousand dollars so if fit hits the shan I can pay it off at one lick.

 

[rambot]

Maybe in addition to reducing the penally for late payments, it would be advisable to understand why so many Americans are so far in credit card debt that they can't afford to make on-time payments in the first place.


View attachment 343673

I think they have some idea.
There is a class warfare happening now as so much wealth is transitioning from the poor and middle to the property owning and higher classes.

Greed has caused unnecessary inflation.
Algorithmic Collusion in the Housing Market - ProMarket
This has caused more homelessness than anything Biden would have done.
It's also ruined a lot of millennial dreams of ever being able to own a house or have a family

 

[JSRG]

I know I am speaking as someone who basically never pays late fees due to paying everything off each month on my credit card, but are late fees really the big issue? $32 to $8 is just $24 less. Isn't the big problem with unpaid credit card debt the interest rates?

 

[Fantine]

I was at a Democratic watch party chatting with a friend who works as a community support person for a large non-profit hospital. She said that sometimes clients come in needing help with prescription drugs and other bills and when she looks at their financial statements, some have had $2,000 in overdraft fees.

That's even worse than the adults with student loans whose interest payments are so onerous their unpaid balance never goes down a notch, even with burdensome monthly payments.

Thank you, President Biden, for accomplishing so much to help the middle class despite a dysfunctional House majority.

 

[iluvatar5150]

I know I am speaking as someone who basically never pays late fees due to paying everything off each month on my credit card, but are late fees really the big issue? $32 to $8 is just $24 less. Isn't the big problem with unpaid credit card debt the interest rates?

I imagine it’s one problem among many, and one that can cascade if you’re already tight for cash when things go south.

 

[wing2000]

Maybe in addition to reducing the penally for late payments, it would be advisable to understand why so many Americans are so far in credit card debt that they can't afford to make on-time payments in the first place.

...you're suggesting the government should do something about people's spending decisions?

 

[o_mlly]

Dems just doing business as usual: Buying more votes with your money.

 

[Desk trauma]

Dems just doing business as usual: Buying more votes with your money.

I’m not seeing how tax money is involved here.

 

[probinson]

...you're suggesting the government should do something about people's spending decisions?

No, I'm suggesting that much credit card debt is a result of people not being able to afford the things they need.

There was a time in my life when I had crushing credit card debt. Some of that was indeed foolish spending decisions. But most of it was life coming at me. I needed a new engine for my car. My roof was leaking and needed fixed. My hot water heater needed replaced. I did not have money to replace these things that I needed, so I put them on credit because I really had no choice.

What hurt me the most was not the late fees but the interest rates that were approaching usury. As someone else mentioned above, an extra $24/month doesn't help you much when your credit card company is charing you 30%+ interest rates. A payment of $200/month on a $4,000 balance would take around 20+ years to pay off in which time you'd pay over $10K in interest.

I'm suggesting that the reduction of late payments that nets people $24/month is a great talking point and headline that in reality will not help people all that much. In fact, they have to KEEP PAYING LATE to reap any benefit.

 

[probinson]

I know I am speaking as someone who basically never pays late fees due to paying everything off each month on my credit card, but are late fees really the big issue? $32 to $8 is just $24 less. Isn't the big problem with unpaid credit card debt the interest rates?

Exactly. Not only that, the only way you "save" that $24 is if you continue to pay late.

 

[o_mlly]

I’m not seeing how tax money is involved here.

Didn't write that any tax money is involved. But if you think the bank issuers of credit cards will not seek to recapture those lost fees from us in other ways then you are mistaken.

 

[Fantine]

Maybe in addition to reducing the penally for late payments, it would be advisable to understand why so many Americans are so far in credit card debt that they can't afford to make on-time payments in the first place.


View attachment 343673

When people have low salaries and no benefits, if their car breaks down, they have a choice--get it fixed or find themselves unable to get to work (in many areas). Or if they have medical expenses...or a home repair they can't fix.

The subsistence economy in our economic inequality society is bleak.

States like Oklahoma allow payday lenders (legal loan sharks--not sure if they break legs.)

And in red states, there are people who would rather see their children go hungry than ask for help. These attitudes are encouraged by the legislators who give tax cuts to the rich as they slice Medicaid rolls...after all, the rich need those books more than disabled children.

 

[Larniavc]

Maybe in addition to reducing the penally for late payments, it would be advisable to understand why so many Americans are so far in credit card debt that they can't afford to make on-time payments in the first place.


View attachment 343673

Late stage capitalism. The US is a predatory economic environment. It's by design and served up to USAians as The American Dream but in actuality is Screw You I Got Mine.

 

[Larniavc]

I was at a Democratic watch party

Is that lie folks who go badger watching in a nature hide or something? But with Democrats in their native environment?

 

[Larniavc]

Dems just doing business as usual: Buying more votes with your money.

Or, and bear with me on this; making some people's lives a bit easier.

 

[probinson]

When people have low salaries and no benefits, if their car breaks down, they have a choice--get it fixed or find themselves unable to get to work (in many areas). Or if they have medical expenses...or a home repair they can't fix.

See my above post. You're preaching to the choir.

The subsistence economy in our economic inequality society is bleak.

States like Oklahoma allow payday lenders (legal loan sharks--not sure if they break legs.)

Not sure why you're singling out Oklahoma. The majority of states allow unregulated payday loans at insanely high interest rates.

Legal Status of Payday Loans by State (2024)

Check the legal status of payday loans by state. Find out which regulations apply for each state and how to make a complaint.

finmasters.com

And in red states, there are people who would rather see their children go hungry than ask for help. These attitudes are encouraged by the legislators who give tax cuts to the rich as they slice Medicaid rolls...after all, the rich need those books more than disabled children.

Interestingly enough, a $24 reduction in late fees on credit card payments won't help with any of that.