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2019 Idaho Real Estate Blog

Think Twice Before Paying With Plastic Main Boise Home Loans
Have you received the letter from your credit card issuer telling you about the double-digit increase in your interest rate yet?

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Dear BuildIdaho.com Reader:

So, here is the new and greatest deal for consumers from the credit card issuers: “Go buy whatever you want, and pay me back over time…plus a little extra for my trouble.” Make that a LOT extra for their trouble.

For the first time in DECADES, American consumers are actually saving a decent percentage of their incomes, but that savings rate could come under intense pressure due to payments on our consumer debt.

Our good friends, the credit card companies, are sending notices to their customers notifying them of large, arbitrary increases in the interest rates that they pay on their revolving debt. “Our good friends?” you might be thinking? Well, we (as taxpayers) have given credit card issuers billions in bailout money. We don’t usually give money to those that we don’t like…right? One would think that our “friends” would be decent enough to not raise our interest rates by double-digit percentages in times like this after they were bailed out. One of my customers recently called me and said that although she hasn’t been late on a payment in over four years, the interest rate on her revolving debt was being increased by 14% on her VISA card.

Consumers share the fault as well…we should NEVER be carrying revolving debt balances on credit cards for as long as consumers have been. Nevertheless, credit card issuers should consider whether hammering the already strapped consumer, is really good for business. Our economy will never fully recover until consumers are confident enough to spend. Remember…consumer spending makes up roughly two-thirds of the economy.

In light of these large increases in credit card interest rates, having “plastic” in your pocket could be considered synonymous to having your head in the guillotine. Unless you are disciplined enough to use revolving credit and plan on paying the ENTIRE balance off each and every month, it shouldn’t make you feel all that comfortable.

If you would like to talk more about this BLOG entry, or have a mortgage scenario you would like me to review, please call me at (208) 880-0316, or email me at eric@ericsloans.com.

Regards,

 


Eric Leigh, Mortgage Consultant
2965 E. Tarpon Drive, Ste. 150
Meridian, ID 83642
(208) 880-0316
http://www.ericsloans.com
eric@ericsloans.com

 
Posted by Eric Leigh at 11/20/2009 12:08:00 PM
Comments (1)
Re:Think Twice Before Paying With Plastic
That makes me about as happy as short term loan sharks, oops I mean service companies. Admittedly, people should not spend what they cannot afford but companies should not be able to put the screws on a person to the point they cannot get above water.

My two latest pet peeves- The companies that promote getting the government and health care insurance providers to pay for your wheel chairs and the companies that will get the taxes and credit card debt removed. Seems like if you owe someone money you should have to pay. I had several builders that owed me money and filed bankruptcy. Of course I may change my mind when I need a wheel chair and in debt past the point of recovery.
Trey
Posted by on 11/20/2009 6:56 AM
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