OT: Credit Card Rates To Double!

[RCCCL]

Thank god I abstane from credit cards and loans.

I have enogh trouble spending oney I already have. I'm not about to start spending money I haven't earned yet.

[Captain Kwok]

Unfortunately, it's not a good idea to abstain from credit cards and things of that sort. Building a good credit report early can really help you in the future when you start buying cars and houses. However, just because you have the credit doesn't mean you need to start spending beyond your means.

[RCCCL]

Actually, Kwok, that brings up a question I have.

Does anyone know whether on line purchases, either with a debit card or second party paying company(such as paypal), affect a persons credit rating?

[Captain Kwok]

A debit card transaction is in essence a cash transaction.

Using a credit card online or in a store doesn't have any real effect other than you are adding a balance to the card.

An aside, I believe credit card companies favor those who carry balances rather than those who pay it all off each month for giving increased credit limits.

[RCCCL]

It would make sense that they do.

If the person is willing to carry a balance, why not encourage them to spend more money by making it readily available.

[El_Phil]

Not just increased credit limits. A 'good' credit record makes it more difficult to get a new card. There's nothing in it for the firm if you pay off the balance each month, so why give you a card in the first place?

[ToddT]

dogscoff said:
*Gasp*. My 0% interest rate would double to... 0%.

And then when this "introductory" rate runs out in a few months and they hike it up to 19%, I'd have to go and find another introductory 0% rate...

Shop around, and transfer your balance regularly. When I'm not paying 0%, I'm rarely paying more than 3%- that's less than either my bank loan or my mortgage.

Its the minimum payment on the balance you owe,that is being increased, not the interest rate. tears ago the minimum was 1/30th of your balance, then it was lowered to 1/40th. It was actually a marketing ploy for the CC companies to make more money.

in fact it turns out the guy who came with idea was also the guy who came up with 0% introductory rate. It to is a gimmick clever one at that. Its 0% if you payoff the balance in time frame the rate is in effect. if you don't pay off entire balance by that time your charged for that interest at the rate it would have been without the offer.

But your right,if your trying to pay off Your CC debt you need to shop around and switch cards, the kicker is don't cancel your oldest cards, you lose the credit lose the credit histery associated with them (unless its bad to begin with) which hurts you when your credit history comes in to play.

in regards to Payday loans, in virginia its come up several times the 600% figure is valid, some screwy loop hole in the state law.

[ToddT]

El_Phil said:
Not just increased credit limits. A 'good' credit record makes it more difficult to get a new card. There's nothing in it for the firm if you pay off the balance each month, so why give you a card in the first place?

So thats why all CC junk mail has dried up, like i miss it.
actullay i've been debt free for over a year and half and i have more credit then i could ever afford to pay the minimum on, at the 1/40th rate.

[Zen]

The credit card and gaining credit points are from regular and constant use of your credit card (and paying the debt off in full).

However, when it comes to things like Kwok said, houses and cars, your credit rating will be looked at in depth and your 'revolving credit' is important. This is the money you have borrowed and is still availiable to borrow in credit and is a factor of your interest rates. So if you are planning on buying something of that magnitude it's generally a good idea to have a few thousand in revolving credit that is not currently being used (meaning balance avaliable not balance used). This includes Lines of Credit from banks and credit unions and HELOC's.

[Xorkh]

Crap, the 6k debt on my credit card is actually going to mean something now. I see this as a good thing (at least in my case) because it forces me to pay more than the minimum and actually have some hope of eventually paying the card off.