It comes as no surprise that the onslaught of the recession - coupled with exposure of some pretty nasty lending practices - has brought on more than a few changes in the financial world. From mortgage to loans and everything in between, consumers are starting to notice a significant change in the way that banks and lenders are doing business. But if you think that these changes are for your benefit, then think again: credit card lenders are declaring war on you, and they are not going to stop until they've squeezed every possible penny out of you.
Want to know what you need to look out for? Here's a quick rundown of the weapons that your lenders are wielding. If you recognize any of these, then it's time to talk to a bankruptcy attorney about the possibility of declaring bankruptcy.
Sky-High Interest Rates
New government legislature regarding consumer protection are about to go into law - however, this means that banks are more determined than ever to make a profit with unscrupulous methods while they still can. Sky-high interest rates are a part of this act, so expect to see a significant increase in your rates without rhyme or reason - even if you have stellar credit. Additionally, one missed payment will really hurt now, so be sure to pay all of your credit card bills on time, even if it's only the minimum payment.
Unexpected Credit Cuts
Credit scores are going to be dropping, and it's not because of poor financial habits of consumers: more credit card companies are starting to cut back credit limits, leaving many individuals stuck between a rock and a hard place with their scores. As credit ratings are determined based on the available credit-to-debt ratio, this means that your rating will shrink as your available credit shrinks. Sure, it's an artificial drop, but one that has negative consequences nonetheless - so if you're credit limit gets cut, call up your lender and argue against this change.
Balance Transfer Deals Are Going To Disappear
Remember the good old days of when you could get a credit card with a 0% interest fee for balance transfers for up to twelve months? Well, kiss those days good-bye, because it's going to be even tougher to find these great deals - and those balance transfers are going to come with hidden fees and smaller introductory periods. Look beyond the introductory period to see what the credit card is offering, because in a year's time, there might not be any more cards to transfer your balance to.
Good-Bye, Subprime Credit Cards
Subprime lenders have learned their lesson with the recession, and are no longer offering the kind of credit cards that poor credit score holders can take advantage of. To rebuild your credit, you'll need to turn to a secured credit card, which requires a deposit in order to be used. Credit reporting agencies view it in the same light as a credit card, so your finances will be back on track in no time.
If you're struggling to pay off a mountain of credit card debt and lenders are hounding you night and day, it's time to discuss your options with a local bankruptcy attorney.