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The Consumers Union Action Fund site has a customizable form that allows you to easily communicate your wishes regarding credit card reforms (S. 414 and HR. 627)

The Consumers Union Action Fund site has a customizable form that allows you to easily communicate your wishes regarding credit card reforms (S. 414 and HR. 627), assuming that you are in favor of ending the abusive practices of credit card companies.  The site provides some suggested text, but you can also write your own message.  

Unfortunately, the form does not provide a means for linking, or text effects such as italics, but that’s a very minor point; passing these protections is vital, so please visit the site and submit your own comments, today.  The text below is what I submitted (feel free to copy and paste into the aforementioned form, if you wish):

In recent weeks, several of the major banks and credit card companies raised interest rates and fees yet again. The media reported Capital One hiked interest rates to 17.9 percent from 12.9 percent. Citibank raised their rates an average of 3 percent.

Over at Chase, customers had a “choice” of paying a $120-a-year fee (which was actually a “finance charge” that changed a previously promised promotional rate) and a coercive higher minimum payment (5% of the balance), or paying a higher interest rate.

Worse, given that Chase executives previously testified before Congress about playing “fairly” by providing “opt outs,” guess what was missing?  If you guessed that the “opt out” was no where to be found in Chase’s change in terms notice, then you are correct — there was no “opt out.”  Doesn’t Congress take testimony seriously enough to hold these executives accountable for misleading our elected representatives with what can only be taken as an outright lie by the 400,000 account holders who received Chase’s notice of such onerous new terms (obviously designed to force customers into other choices, such as doubling their interest rates)?

I don’t understand why interest rates for consumers are so high, when the interest rate banks charge each other for overnight loans is as low as 0 percent.

As a responsible credit card consumer, I shouldn’t be subjected to unexpected interest rate increases and fees, which only drive up my costs during these tough economic times. The Federal Reserve Board recently agreed to new credit card reforms which would curb many of these abuses, but those rules will not go into effect until July 2010.  Further, Chase wanted 18 months to comply with these new rules, yet it argued that customers should only need 15 days to comply with its new rules.  Why not protect consumers from these one-sided and completely unfair credit card issuers RIGHT NOW!

The bills being considered would go even further than the rules to help consumers, such as limiting the duration of penalty fees which can sap consumers’ wallets, and curbing aggressive credit card marketing to teenagers without an ability to pay. The bills would:

— Prevent my card company from changing the rules of the game midstream. Companies shouldn’t be allowed to arbitrarily hike the interest rate on my existing balance or new transactions if I make my payments on time just because of an “anytime/any reason” clause in the contract. The deal I signed up for should be the deal I get.

— Require card companies apply my payments fairly across my different balances, not just to the lowest-interest balance. That’s just common sense.

— Control the size and duration of penalty interest rates. Companies shouldn’t be able to keep me at usurious interest rates forever only for one late payment or another minor infraction.

— End abrupt reductions in my credit limit, which negatively affects my credit score through no fault of my own.

—  Provide an adequate amount of time to pay my bill on time by requiring my bill be sent out no later than 21 days from the due date.

— Prevent fees just to pay my bill online or on the phone.

— End aggressive marketing of credit cards to young people who need a chance to establish themselves without a heavy debt burden.

Let’s not forget that small businesses frequently use credit cards.  According to a Federal Reserve Report (2007, showing 2003 data), almost half (46.7%) of small firms used personal credit cards! has published a “Credit Cards and Small Business Usage Report,” which provides additional information about the impact of credit card company abuses on entrepreneurs.  Given that an economic recovery will not be possible without a healthy entrepreneurial environment, it is extremely important that you support these needed reforms. 

Indeed, while they are generally long-overdue, under our present circumstances it is vital that you act to stop the next meltdown that the banking industry’s reckless “strong-arm” tactics with consumers and small business owners will actually create, this time over “plastic.”  Don’t let those who have exhibited a clear pattern of failed leadership relative to the banking industry’s numerous misjudgments, unethical behavior, and greed, lead us all down a path of financial destruction in yet another context. 

If these banking industry executives were honest and competent in the first place, we would not all be where we are today, in a crisis that spiraled out of control at a tremendous cost, which will be shouldered for generations.  Please stop listening to their spin, lies and rhetoric, and listen to US (ordinary consumers and entrepreneurs on “main street”) for a change.