Wednesday, May 03, 2006

Posted by Sickboy at 11:07 AM
Thought for the day :


" Creditors have much better memories than debtors. "

3 comments:

Sickboy said...

and this is why I choose not to own a credit card.

1:08 PM CDT
Mark M said...

Nothin' wrong with having a credit card... Just don't carry a balance. Even if you have a low rate, the credit card companies can change that rate on a whim, and suddenly you're stuck with revolving debt that you can never pay off.

Last year the Republican Congress passed bankruptcy "reform" (along party lines) that was just a gift to the credit card companies. Normally, risk is shared between creditors and debtors. Creditors run the risk that debtors will default (declare bankruptcy) and never repay them. Debtors run the risk of financial ruin, and bankruptcy affects future access to capital.

Let's say you have what you think is a manageable amount of credit card debt at 8% interest. But then you get hit with a huge unexpected expense and end up being late on a phone bill. Your credit rating goes down, and suddenly your interest rate shoots up to 19%. It used to be that you could declare Chapter 7 and wipe that debt off the books -- cost of doing business for the credit card companies, but they'll think twice before lending you money again. Under the new law, you'd probably have to declare Chapter 13, which means you'd still continue making payments to the credit card companies (via a bankruptcy trustee) 'til they bleed you dry. (end rant)

2:32 PM CDT
Sickboy said...

I know there is a HUGE diff. between owning a credit card and not using it but that is where I would fall short and so I dont own one. Im the ugly american and I love to abuse things, a credit card would be included in that.

6:22 PM CDT

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