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Thread: Beware Broke Banks

  1. #1
    God/dess Deogol's Avatar
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    Default Beware Broke Banks

    Lenders have found new ways to squeeze more profit from borrowers. Though prevailing interest rates have fallen to the low single digits in recent years, for example, the rates that credit card issuers routinely charge even borrowers with good credit records have risen, to 19.1 percent last year from 17.7 percent in 2005 — a difference that adds billions of dollars in interest charges annually to credit card bills.


    Average late fees rose to $35 in 2007 from less than $13 in 1994, and fees charged when customers exceed their credit limits more than doubled to $26 a month from $11, according to CardWeb, an online publisher of information on payment and credit cards.



    Mortgage lenders similarly added or raised fees associated with borrowing to buy a home — like $75 e-mail charges, $100 document preparation costs and $70 courier fees — bringing the average to $700 a mortgage, according to the . These “junk fees” have risen 50 percent in recent years, said Michael A. Kratzer, president of , a Web site intended to help consumers reduce fees on mortgages.


    This is too classic...

    The Salute Visa offered Ms. McLeod a $300 credit line. But a closer look at the fine print showed that $150 of that would go, as annual fees, to Urban Bank.
    Last edited by Deogol; 08-16-2008 at 03:41 AM.

  2. #2
    Banned Melonie's Avatar
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    Default Re: Beware Broke Banks

    ^^^ ultimately, this boils down to the attempted 'cancellation' of credit to 'subprime' borrowers in every area of loans ... from mortgages to student loans to auto loans to credit cards. The banks are using every trick in the book to make sure that 'subprime' borrowers will pay through the nose if they want continued access to credit. Arguably, this is only 'fair' because the vast majority of loan losses also stem from 'subprime' borrowers.

    I would also add that for 'prime' borrowers, a few banks are now cultivating these customers via the return of 0% introductory rates, zero annual fees etc. This seems to be a recognition that 'prime' borrowers were not willing to sit still for interest rate jacking / fee piling on their 'prime' accounts that were recently imposed by some banks who specialized in 'subprime' lending in order to try and offset their 'subprime' losses. As a result, certain banks (like Chase for example) is actively trying to attract disgruntled 'prime' borrowers away from other banks, while slowly but surely throwing their own 'subprime' customers overboard. In the end this is likely to devolve into a two tiered banking system - with a VAST disparity between 'prime' and 'subprime' interest rates / fees / availability of credit.

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    God/dess whirlerz's Avatar
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    Default Re: Beware Broke Banks

    One of my credit cards is under Barclay, which I read here, is bailing,.


    MANY MEN WANTED TO LAY ME DOWN, BUT FEW WANTED TO LIFT ME UP

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