On Thu, 25 Nov 2004 22:21:43 GMT, "RS" wrote:

"Jay Honeck" wrote in message
news:3Lspd.391816$wV.73568@attbi_s54...
But tell me, what will you do when home, auto and commercial proprerty
loan companies hike their rates just because they feel like it? Even if
you pay on time, every time. All they need to do is lobby hard enough to
put it into law and you are totally screwed.

What then, Mr Clever Guy?

I'm not following you. If you pay "on time, every time" -- credit card
companies CAN'T charge you any interest.

What would you do if they hiked the APR on your auto or home loan just
because they felt like it, even if you had a perfect payment history? Well,

Does the phrase; Adjustable Rate Mortgage ring a bell.

that's what the credit card companys are doing now - they are changing the
rules mid-stream. Credit is credit - regardless what it is for. You guys on
your high moral horses about paying credit cards off every month do not
impress me (unless you have zero credit - no home, auto, commercial loans at
all).

That doesn't quite make sense.
They are not changing the rules. They are there in B & W (color in
some cases). In every card I've had over the last 10 years they have
stated they could change the rates at any time they deemed necessary.

The point is: If you really need to borrow, which nearly every one
does at one time or another, do it sensibly.

Like the checks they offer at very low interest rates. Is there a
catch? Generally the answer is yes.

Move your loans to our card and pay only 3%? Look in the fine print
and that may only be good for a couple of months and then the rates go
to 18% APR, or even higher. Have enough equity to cover them? Take
out a second mortgage to pay them off. Most likely the rates will
only be about a third of that of the CC. Then cut up every card
except one and limit its use to absolutely necessary items only.

OTOH car and home loans get bought and sold just like any other
commodity. Some have some pretty high penalties for paying off early.

*IF* I need money I can write checks against the equity in our home
loan. I could get a signature loan. The interest is only slightly
higher than the mortgage which is a small fraction of what a credit
card would charge. It's also treated as a separate loan and doesn't go
against the home loan... unless we'd default.

For the person who has 3 or 4 credit cards, finding one company with a
low introductory APR for 6 months might be their way out of a deep
hole that's been getting deeper.

You have to be careful about changing CC companies though as each
credit check goes against your rating.

Be it a CC or bank loan they have to tell you up front, just what it's
going to cost. Be skeptical of the TV adds. Take time to read the
fine print no matter how restless the loan officer gets. :-)) Those
companies are going to get their money one way or another

Credit card companies usually make a fixed amount off every sale.
Probably on the order of 5%. You can say the merchant pays that, but
who isn't going to pass it on to the customer?
When the CC companies start pushing the rates up it is for one of two
reasons. General rates are going up, and/or they have a lot of
customers defaulting on payments. CC rates are so high because there
are so many defaulting on payments.


Credit cards are the easiest way to borrow money. They are also the
most expensive/poorest way, with maybe the exception of the local
loan sharks.

I don't know if the law has changed, but at one time the credit card
companies could charge at least double what an individual could for a
loan.

BTW, every since the checking account has existed, people have
depended on the time for a check to clear. That is coming to an end
as are the jobs flying canceled checks. In the not too distant
future, when you write a check, it will be debited against your
account and credited to the payee almost instantly. It's this way in
some areas now, but it's becoming universal.

Roger Halstead (K8RI & ARRL life member)
(N833R, S# CD-2 Worlds oldest Debonair)
www.rogerhalstead.com