The new credit card rules went into effect Monday February 22, 2010. And if you thought that this finally brought the end to banks and credit card companies’ bloodsucking practices, think again. Banks started devising new ways to bite you in the ass before the new rules took effect.

Granted, there is no way to foresee every move and counteract it through legislation. In fact, it is also phenomenal that the bill was not killed at conception. May be there is some change at Washington after all (though we still have miles to go). Corporate America and the legislative bodies became bed partners long ago it is not going to change any time soon. But that’s a different subject. More on New Credit Card Law – Banks Can Still Bite You in the Rear

It is a good thing that new credit card rules and regulations have been enacted to protect consumers from predatory practices. But banks found ways of going around these laws even before they went to effect Monday February 22nd 2010. More on New Credit Card Laws: Good But Not Good Enough

If you use your credit card to buy stuff like beer and expensive customized auto parts, watch out… your bank might think you’re a deadbeat in waiting.
It’s because of the comprehensive profile made of each and every credit card customer. The profile is based on what you’ve bought with your card, personal details you give to customer service reps (like a recent divorce or job loss), the time of day you log in to your online account (Is it late at night or when you should be at work?), how often you’ve been late or missed payments, the balance you carry each month, and more.
It all makes its way into a database that the card companies and their consultants use to determine if you are a good risk for a higher credit limit, which interest rate to charge you, and when it’s likely that you are dodging them and should be scheduled for a call from the collection agency.
(Source: The New York Times)

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On Friday May 22, 2009 President Obama signed The Credit Card Accountability Responsibility and Disclosure (CARD) Act into law. Though in a way the banks shot themselves in foot through sheer greed and unfair (read abusive) business practices, we consumers can’t help but celebrate. We had won a battle against “special interests”.

Well, special interests did get something out of it after all, as the new law will not go into effect until February 2010. This law should have taken effect immediately. The banks and credit card companies are doing it (abusive practices) now! Why give them more time to continue trampling it over us?

More on New Credit Card Laws – Celebrating a Corporate Greed Loss

Credit card debt doesn’t shy away from anyone who doesn’t want to shy away from it. It treats everyone equally irrespective of whether the person is a seasoned professional or just a college student. So college student credit card debt isn’t uncommon either.

Since the credit limit on college student credit cards is usually much lower, the college student credit card debt cannot rise to the levels it does for other credit cards.

However, college student credit card debt is an even bigger menace because a lot of students are already in debt due to the loan they have taken for their education. If they pass out of college with college student credit card debt, they will have to pay back not just the loan they taken for studies but also their college student credit card debt.

More on College Student Credit Card Debt

Credit cards are a much loved accessory in the easy spending world of modern society but we have been misusing them. That insignificant piece of plastic has got countless people into serious financial trouble. The old fashioned system of pulling a wad of bank notes from your pocket and paying cash for things is long gone. Now we just book up the plastic.

We do not just have one card either; many of us have a fistful of them, all with debt owing on them some with huge debt on them. In fact some clever people manage to juggle these cards. They manipulate them so that one pays off another card and another card pays off the first one. On it goes but of course this is totally unsustainable.
More on Avoid Credit Card Debt

Part 1 of the World of Credit Cards explained bank credit cards and how they work. The easiest credit card to attain is travel and gas cards.

Travel, Gas and Department Chain Credit Cards

These cards are easier to qualify for. Similar to bank credit cards however consumers can charge purchases at various gas and convenience stores. However, they are different from bank credit cards because they are offered directly by the companies and not via the bank lender.

Travel and Entertainment related venues once widely accepted these cards. Some places such as airlines, hotels, restaurants and car rentals widely accepted these cards and still do today accept with broader guidelines. Nowadays, other establishments, such as department stores and gas stations, accept them. Like any bank card, the typical travel and entertainment card of today offers the menu of features that most credit card holders have come to expect.

Another major difference among these cards is, they do not carry an extended line of credit. Meaning, upon receiving your monthly credit card statement, you will be required to pay your outstanding balances in full.

A house card is accepted only at specific stores or stores within the same chain. Retail credit cards are one of the largest types of credit cards; major store chain card issuers include department stores, gas and convenience stores, and a few telephone companies. The Discover Card, once owned by Sears, was the most well-known chain store card until it was purchased by a banking institution.

Merchants view these credit cards as an advantageous marketing platform. These cards help to assemble customer allegiance and improve their sales; Just like a bank credit card, a house or chain card provides you with a line of credit. This credit limit will vary depending on your past credit history and current creditworthiness. These cards offer a revolving line of credit and you can pay a minimum on your balance each month.

All credit cards will carry an interest rate which will add on additional costs to the consumer. If you carry a number of credit cards, you may want to consider discarding of some (but don’t close the accounts!) and saving you some money in the long run.

If you are the type who pays your entire balance each month and does not carry a balance, you can probably qualify for a credit card with no annual fees. However, as with everything, read the fine print and pay close attention to dates. Banks are known for increasing fees and interest rates after a specified time.

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Banks and credit card companies are not happy. They have been having too good, but now there’s trouble in paradise. I’m not complaining. After all, I’ve been a victim of some of the unfair practices that have pushed some otherwise good credit consumers into “sub-prime” status.

Once these new regulations have been enacted, no longer will banks and credit card companies be able to impose penalties for one day lateness in making a payment. They will be required to give you more time (21 days seems to be the proposed time span).

Also, they will not be able to raise interest rates at whim. It is interesting to learn that they have been increasing rates even for accounts in good standing.

Though still too soon to say in certainty, it is interesting that the lobbyists don’t seem to be getting their way for a change. Also to note is that this has come in the midst of the current credit crisis. Did have to take a crisis for those guys in Washington to see that there is really a problem?

The lobbyists have been having it their way for too long now. They even succeeded in having new bankruptcies laws passed (in the name of “bankruptcy abuse prevention act” or something like that) that gave lenders unfair advantage over consumers. Please don’t let them touch this one.

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Every day lenders clog our mailbox with over 4.5 billion pieces of promotional offers inviting consumers to apply for a new credit card. Even those not qualifying for the conventional credit cards due to impaired credit receive offers; some credit card issuers specialize in marketing these offers to consumers worldwide.

Credit is our economic foundation and we rely on this. The average American household is projected to have a minimum of ten credit or charge cards. Most consumers will think one card is just the same as the next, that’s not exactly true.

There are in distinctions among each card and characteristics for the category of credit cards. There basically are four distinct, different types of cards used today: a bank credit card, a gas card, a retail credit card and a charge card.

Part 1 of this 2 part credit card article will explain the various credit and charge cards.

Major Bank Credit Cards

Most people are familiar with MasterCard, Visa, and Discover card. These are the major bank credit cards. While these cards are the more well known banking cards, none directly distributed to consumers; the first two companies (MasterCard and Visa) do not issue credit cards directly to consumers.

These credit cards are issued to banks that are approved by Visa and MasterCard to utilize their name and distribute to consumers. Each bank is associated to the credit card association, because they are not allowed to issue any kind of card unless they are association members.

A bank credit card provides a revolving line of credit. Each month upon receiving your credit card statement, you have a choice of paying the entire balance or a portion of it.

Upon receiving this type of card, you will be authorized for a pre-determined credit limit. This limit will depends on factors such as credit history, monthly salary and disposable income. Not all major bank credit cards offer advantage to you. These cards come with various interest rates.

For many years, high interest rates were only for those people with a slightly damaged credit history. Now days, high interest rates are common and more readily accepted.

This is the most valuable type of credit card to get when building or repairing credit. However, it’s possible for card holders to get themselves into trouble when they are unable to manage this revolving credit line. If this happens, the bank will cancel your card and place a negative mark on your credit report.

Many guidelines of the bank credit cards have changed; Most of the features and benefits changed, some for the good and some not so advantageous, but the basic characteristics of these bank credit cards have remained the same.