CC minimum payment increase...HOLY COW!

[Disney1fan2002]

I have known for a while now, that by law, credit card companies have to increase what they require for a minimum payment. As bad as it sounds, it is actually a law FOR the consumer. It is forcing cc companies to apply more money to the principle balance.

Well, I got a little shell shocked when I opened my cc bill. It went from a minimum of $140 to $390! I always send more than double, but HAVING to payy that much, looks like I got to figure out a way to stop using my cc! if it were only that easy!

 

[LisaNJ25]

Wow that is a huge jump.

 

[Tigger_Magic]

There's going to be a lot a "mailbox heart attacks" this month.

 

[mickman1962]

If you can't pay 4% on your credit card balance, you shouldn't have/use one. Yes there are always a few valid exceptions but 99.9% of time it's just people spending more than they make.

 

[Jennifer S]

My DH pays the bills so last time I looked at a cc statement my min. was $10. I'm shocked. We just pay it off every month. Is that normal to pay so much?

 

[sweet angel]

I refinanced my house and paid off all credit card debt and my truck. Looks like I did it just in time. Credit card debt is hard enough to get out from under -- without them raising the minimum payments. My outgoing payments dropped from $900 to $300...and I can deduct the interest.

 

[cardaway]

If you can't pay 4% on your credit card balance, you shouldn't have/use one. Yes there are always a few valid exceptions but 99.9% of time it's just people spending more than they make.

ITA. In fact IMO 4% is still not enough.

 

[Chicago526]

Well, the new higher minimums will HELP the majority of card holders (that carry a balance) in the long run as it forces them to pay it down faster. It's only a problem for those people who could barely make the minimums before the increase. They're the ones that could be in trouble.

BTW, is the new minimum 4% of the balance plus the interest, or is is 4% of the balance including the interest? I'm pretty sure my cards have already increased their minimums, but I could be wrong. I pay over double the minimums anyway (trying to pay mine off in 18 months) but I just want to be prepared if they hadn't gone up yet.

 

[mickman1962]

BTW, is the new minimum 4% of the balance plus the interest, or is is 4% of the balance including the interest?

I believe the rules now require that the minimum monthly payment include the latest interest charges, late (but not overlimit) fees, and at least 1% of the principal. The card company can set higher minimums.

 

[WatchinCaptKangaroo]

And it is up to each company to decide if they want to raise minimum payments. Some companies will raise everyones, some will raise only those who have an APR over a certain percentage, some will raise only those who have a balance over a cetain amount.

 

[Toby'sFriend]

As bad as it sounds, it is actually a law FOR the consumer.

well, I'm a skeptic. I having a suspicion that these changes have more to do with the new bankruptcy laws that now prevent more people from just walking away from their credit card debt.

Chase doubles the required payment, people who were skating on the edge now can't make the minimum by the due date, Chase gets to up their interest rates to about 22%.

 

[Chicago526]

I believe the rules now require that the minimum monthly payment include the latest interest charges, late (but not overlimit) fees, and at least 1% of the principal. The card company can set higher minimums.

Okay, sounds like both of mine already did the increase. So I'm paying double the NEW rate. Good! While my intention is to keep paying over the minimum, if disaster strikes, it's good to know I've got breathing room!

 

[MrsPete]

If you can't pay 4% on your credit card balance, you shouldn't have/use one. Yes there are always a few valid exceptions but 99.9% of time it's just people spending more than they make.

I have to agree. If the MINIMUM PAYMENT scares you, you really should consider the amount of the whole balance. If you pay only the minimum, you will need decades to pay it off. Ever wonder why we all get so many credit card applications in the mail? It's really, really, really profitable for the credit card company.

I refinanced my house and paid off all credit card debt and my truck. Looks like I did it just in time. Credit card debt is hard enough to get out from under -- without them raising the minimum payments. My outgoing payments dropped from $900 to $300...and I can deduct the interest.

And if you can't make that payment for some reason -- even a good reason like being laid off, sick, whatever -- they can take your house. I'm not a fan of this type of loan.

Actually, I'm not a fan of any type of loan.

 

[McDISer]

To the people telling the people that if you can't pay at least 4% of your credit card debt plus interest each month, we shouldn't have a credit cards. We are spending over our incomes.

I hope you never, ever have to experience a lay off or any other circumstance that you have to use your card for an emergency. Try telling a Dr. or a dentist that you cannot pay your bill. Or better yet, you don't pay your heat bill on time this winter, they alone will take you to court and charge you 3 times the amount of your previous bill that you do owe.

So, when you are sitting in your nice warm home, looking at your healthy children, because you are able to take them to the Dr. when they are sick-just remember that some of us are looking for a job every day, and we might just have to use our credit card for the Dr. and dentist.

 

[sweet angel]

And if you can't make that payment for some reason -- even a good reason like being laid off, sick, whatever -- they can take your house. I'm not a fan of this type of loan.

Actually, I'm not a fan of any type of loan.

Unfortunately, we can't all pay cash for everything. As a single mother, I make DAMN sure that I can make ends meet. This refinance/debt consolidation allows me to be able to sock money away for savings and emergencies as well as just being able to pay my bills.

I didn't do it so I had more money to spend, I did it so I'd have more money to save.

I'm sorry if you don't approve.

 

[luvmy2sams]

Wow--it took 3 posts before the lectures started rolling in...

 

[cardaway]

Wow--it took 3 posts before the lectures started rolling in...

Since everybody suffers when deadbeats don't pay their bills, you bet you're going to hear from those that are responsible.

To repeat, there are a few that fall on hard times but the vast majority are people simply over spending and being irresponsible.

 

[Feralpeg]

Since everybody suffers when deadbeats don't pay their bills, you bet you're going to hear from those that are responsible.

To repeat, there are a few that fall on hard times but the vast majority are people simply over spending and being irresponsible.

IMHO, calling someone who pays their bills on time, but can't pay them in full a deadbeat, is a little harsh. In my mind, a deadbeat is someone who just doesn't bother to pay. We don't know everyone's situation. I don't think it is right to judge people we know nothing about.

 

[luvmy2sams]

Since everybody suffers when deadbeats don't pay their bills, you bet you're going to hear from those that are responsible.

To repeat, there are a few that fall on hard times but the vast majority are people simply over spending and being irresponsible.

I hope you're not implying that those who make minimum payments on their credit card(s) are irresponsible deadbeats. Life happens and unfortunately debt can, too.

The OP posted her significant minimum payment increase and almost immediately the responses turned to "if you can't pay it off, then don't charge it." It's amazing how quickly the soapboxes can come out around here sometimes.

The true deadbeats could care less about payments rising. It's for the "good of the consumer" in the long run, but in the immediate future I'd wager that it's only going to hurt those trying to get out from under the debt burden that they incurred for whatever reason.

 

[cardaway]

IMHO, calling someone who pays their bills on time, but can't pay them in full a deadbeat, is a little harsh. In my mind, a deadbeat is someone who just doesn't bother to pay. We don't know everyone's situation. I don't think it is right to judge people we know nothing about.

How exactly does somebody pay a bill on time if they don't pay the bill in full? You either pay the entire amount due or you don't.

I have no problem with the term deadbeats considering the majority of folks skipping out on credit card payments.