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The Scary Aspects About Consupmer Credit Cards To Be Displayed On Bills Thanks To New Credit Card Reform!

Consumers are going to be in for a shocking surprise to be shown on billing statements for credit card accounts. Did you know that the average card holder only pays off only $2,000.00 every 3 years on their credit cards. If I would have told you this 2 years ago, you probably would think that I am a nut! How can it be within the laws for banks to charge you over 20% interest and on top of that keep you in debt for such a long period of time. Well, now you are going to notice that I was not lieing 3 years ago! Due to the new credit card reform, credit card companies are going to have no choice but to show you how long it will take to pay off your debts. The scary aspect of this is that on some of these statements credit card companies will have to clearly print that YOU WILL NEVER PAY OFF THIS ACCOUNT PAYING ONLY THE MINIMUM PAYMENT. I can already see your reaction! It’s probably something like “What! Are you kidding me, how, why, can they do that?”. The answer is yes they can and they will! I want to explain how, and why:

How:
The vast majority of credit card companies with the exception of few such as Discover credit cards, structure minimum payments as 1% of the balance plus interest charges. Some of these banks will even charge less as a minimum payment! Just for this example I am going to use 1% plus interest charges so you can fully understand how this works! Lets say you have a balance of $25,000.00 on one of your credit card accounts. On this card you are paying 20% interest. Well 1% of this balance will be $250.00 which is all you will put toward the balance this month. Interest this month will be $416.67 meaning your overall payiment will be $666.67 for the month. Knowing that only $250.00 of that payment will actually go toward the balance is anoying enough but now hopefully you can see how they can keep you in debt for so long!

Why:
Well when you look at it from the banks point of view this is actually a great thing for them. Over the term of your debt they are going to make more than what they loaned to you in the first place. Even if you don’t ever pay the debt off, the bank still stands to make a huge profit from your account! Now that you understand how and why they do this, I would like for you to go to www.JemCreditCards.com and learn how to get around it and actually get the chance to pay your debts off!

For more information on this topic or to discuss any other topic, feel free to contact us:

By phone : (561) 355-0069
By email : Support@JemCreditCards.com
On the web : www.JemCreditCards.com

Tags: credit card, credit card law, credit card laws, credit cards, credit cards law
Posted in Credit · March 15th, 2010 · Comments (0)