Quick Credit Cards

Credit card rates and fees soar thanks in part to lost credit card debt.

Many consumers thought the interest rates and fees on their credit cards would go down or stay the same as a result of the new laws initiated in 2009, but the opposite has turned out to be the case.

In fact, the Credit Card Accountability, Responsibility and Disclosure Act is part of the reason lenders have hiked both rates and fees since it was enacted. According to a report in the Newark Star-Ledger, the laws, along with losses as a result of bad credit card debt being written off as uncollectable and drops in consumer spending, have led interest rates to skyrocket in the last year. Just 12 months ago, the average credit card interest rate was 12.1 percent, but despite the new laws, that number has risen to 13.64 percent.

The report also says that a number of companies have raised fees on everything from cash advances to balance transfers to make up the shortfalls. Some banks have also added annual fees and eliminated free checking accounts.

Many credit card companies have been seeing their profits decrease because they are being forced to write off greater amounts of credit card debts as being irretrievable as more consumers cannot pay their bills.

Similar Posts:

• American Credit Card Debt Decreases
• More new credit cards issued in 2011
• Is a Credit Card Alternative Coming to a Convenience Store near You?
• Credit Card Loyalty Improved Among Consumers Thanks to CARD Act
• Foreclosures in Honolulu surge