Unusual and unexpected credit card practices seem to be pretty common nowadays; however, while they’re common, they’re not necessarily invited. It’s tempting to excuse the credit card companies for their adjustments, until one remembers that they’ve been granted Federal money to remain operable – and according to Bloomberg data, celebrated $27 billion in operating profits in 2007.
So what does that mean for the customer? What guarantees are we given in the midst of already difficult times that our credit card limits won’t fall drastically and our interest rates won’t raise at the drop of a dime?
Here are a few prospective guarantees:
- Interest rate restrictions. Effective July 1, 2010, the Fed will restrict sudden changes in interest rates.
- Congress pushing for change. Democrats in Congress are said to be pushing legislation that will add more consumer protection and move up proposed changes.
Consumers hope these adjustments will make a difference in credit card practices from companies. But what do we do until these laws take effect? Some companies are offering customers extended warranties. For example, all Visa Signature cards come with one year of additional coverage for all purchases made on the card. Mastercard offers an extended warranty on Platinum, Gold and World cards. And some companies are offering interest rate and cash-back deals – however, look out for restrictions that may be included.
Unfortunately, there is no definite resolution – or even pattern – to expect regarding the credit card companies’ practices in the near future. So if you have a credit card, your best bet is to buckle up and get ready for a bumpy ride. Credit isn’t always a bad thing. If you monitor your spending and build your credit responsibly, you can greatly benefit from having a credit card with low rates.