Epower Today: Credit Card HurriPAINS

Consumer Credit HurriPAINS:

Hitting us when we're all down

Copy Protected, September 2005

Allan Shore

The residents of our south and south-central states are beginning to feel just what its like to receive repeated punishments, what with the onslaught of weather and infrastructure challenges. But the rest of us seem oblivious to being inundated with a form of devastation of our own, which comes in the wave after wave of financial injustice that we call Credit Card payments.

Perhaps one of the reasons that we accept our punishment so willingly and without the slightest of a disaster response team is that we voluntarily inflict the pain and suffering upon ourselves by opening those blasted envelops (or perhaps emails) that contain the storm in the form of credit card assaults (by which I am referring to the "bills" we get, not the advertisements, which are another matter themselves). I hate to refer to these assaults as "bills," however, because, in addition to demeaning a word that I have grown rather accustom to, most of these little terror packages no longer show purchases and such, as I have stopped using them for those purposes. Instead they reflect only the most recent flurry of destruction being unleashed by the computers and the lawyers and the bankers who, for lack of better things to do, simply re-define, re-interpret, change, modify, alter or swap away the "terms and conditions" that govern what started out as a nice little business arrangement.

What an awful mess! ''These personalized credit card assaults have become so bad I can barely see the due dates or delinquency notices through the forest of verbiage that hides all of my guarantees and protections.''

How I got from the convenience of having money on demand to having a legal hurricane smash through my life month after month after month is beyond me. But they tell me it is what I signed up for.

Personally, I'm not so sure about that. I would even attest, if wired to the Patriot Act, that I actually thought when I first sentenced myself that I signed up for straightforward agreements of convenience that would even become less cumbersome with time, not more. Like those "terms of agreement" that come connected to all-things electronic or software. I swear to God that after years and years of blind exploration, I actually now generally understand what I am buying for my computer. Someone, somewhere, with nothing left to do in their In Pile, decided that there might actually be some customer satisfaction points in letting us victims understand what we are doing when we join in their fun little games … and I tell you, I'm getting to like that feeling.

For credit cards, however, I'm just getting increasingly annoyed. In fact, I believe that there is reason to assume that we should collectively move forward and assume that there may actually be wisdom in the knowledge of the crowds of people who are complaining about the unfairness of our financial partnership terms. In fact, there may actually be Constitutional grounds for objection—right Harriet?

JEOPARDY TIMES FOUR

From what I can tell, the average consumer—-using me as an example, of course-—gets punished in no fewer than four (4) different ways with each an every interaction, especially if said transaction even stumbles close to the idea of a LATE PAYMENT, whatever the current conception of that might be. (Apparently the time of day, location on the planet, color of the check, closeness to a past nation disaster, etc. all play roles in what the "date" of receipt really is.)

But first, lets set aside those of you who believe my problems and those of the masses of us lowlifes would be solved "If you would just pay the stupid bill!" 

Well … there is something to be said for that. But I also say without embarrassment that is was my intention when I signed up these cards to do just that, given what my financial condition was at the time. However, I live in a volatile employment field and the terms and conditions of my income generation change as if they have an agreement of their own.

I find, for example, that my income now comes in on way different days of the week or the month than it did when I agreed to make the payments. And, of course, what with failed national economic strategies, I'm not necessarily on schedule for the annual cost of survival increases that my college career counselors promised.

To address this, on two different occasions, I actually called the credit companies and told them of this with the goal of adjusting my due dates to coincide with my new income arrangements. But apparently, SIR, "the fine print of our agreement doesn't allow that. So don't even consider it." The due date is the due date is the due date--at least until they feel the need to make it something else. My employment considerations, "we are sorry," are not relevant.

Okay. So we get back to quadruple jeopardy. The fact of the matter is that the ability to control the language covering this agreement is totally in the hands of the other side. My job is simply to pay the bill on time or face multiple punishments for the same infraction.

I can hear them all laughing now: "This poor schmuck actually things the 14th Amendment applies to humans, hehehe."

I can actually count at least four repeated punishments that I regularly receive from any given repayment offense—something that definitely smacks of a direct assault on my double jeopardy protections.

Here is how I see my sentence being played out:

PUNISHMENT NUMBER ONE: Late Fees

Since I never quite know when the due date is—-they vary, remember, depending on when my last payment was made, or should I say registered with them—-nor when my income is coming in, I make the payments as best that I can. In accordance with our agreement, the rules say that: IF I don't make a payment on time, THEN I will receive a late payment charge. When I started it was a very low and reasonable amount, such as $5; now it is somewhere usually between $25 and $35, approaching a bit of an extreme since the actual payment itself is seldom more than perhaps double that amount. But the fact of that matter is: I agreed to pay or to pay a late fee. And that I am willing to do no matter how much it hurts. When I am a bad boy, I deserve to be punished. So be it. On some level I guess it fits the crime. No contest.

PUNISHMENT NUMBER TWO: New Interest Rates

But the sentence does not stop there. If I happen to be late for one of those payments on some particular day when the moon is in the seventh house and Jupiter aligns with the prime interest rate and our president is not up for re-election, then I find out that the terms of our agreement have "now been altered" and I must face a change in the interest rates on my "loan." Instead of the rate of 3% or 5% I must now realize that my lack of due date diligence means I now start paying anywhere from 22% to 35% interest, on the very same money I borrowed before at the lower rate. (Anyone familiar with the concept of "usury?") This, of course, means the monthly payments must go up accordingly, as will any future late fees that may follow.

PUNISHMENT NUMBER THREE: Over Limit Fees

Well, it doesn't take a genius to see where this one is going: they have changed the dates, changed the amounts owed (upward), added on late fees and otherwise rerouted the manner in which I must deal with them. It turns out that having committed the above infraction and having been reclassified into a higher interest category, they have a right to lower (or "otherwise modify," which I presume means increase) my credit limit. Doing so thus causing an aforementioned reaction of my having reached my credit limit, meaning I must now pay an "over limit fee"--all covered, SIR, by Section Number, Subsection, Paragraph, highlighted-for-emphasis area such-and-such, which specifies that they now have the right to charge a rate equal to or above the Late Fee limits for any amount above the agreed upon terms. Huh?

PUNISHMENT NUMBER FOUR: Credit Record Indicators

I never really thought much about this until recently, when I was getting around to look at my credit history to try to get into another credit agreement. (When do we learn?) Enough TV and pop-up advertisements have convinced me of the wisdom of this move, in that I had made the decision to move into becoming a big boy home owner (where owners are good and mortgage holders are nervous). But, sadly that was not to be. For I was to soon discover that my past mulitple infractions generated yet another punitive reaction to the same crime. It turns our that my being late, and paying late fees and even the changing of my loan amounts, all combine to result in marks against me on my credit history. "Tsk, tsk, tsk: not even a 600!"

So now I am not only late on my payment, I'm a credit risk with a credit score far below the average—a score that makes it impossible for me to gain virtually any new credit accounts. Even though I made all my payments and paid much more in accordance with my side of the credit agreement, I am now officially recognized as being a financial lowlife. 

CORRECTIVE CREDIT COUNSELING: But let's not stop there. I got a BONUS PUNISHMENT in the form of Corrective Credit Counseling. The details are simple, really: the "counseling" service is a clearing house of sorts that claims that they can do what no other human can do, which is communicate productively with the credit card company on my behalf (read: I get screwed again). All I need to do is sign up for their partnership, make a "mandatory" donation, which sounds suspiciously like a fee to me, and then follow up on their work by contacting my creditors. If I do this, then the payments come down closer to where we began this journey (without cutting out all the add-ons and new credit amounts owed and such). 

I bought the hype and did as I was told. Only to find out that in doing so I was actually pre-maturely closing my accounts, subjecting them to all kinds of new rules. The total amount now due was now my credit limit and that I no longer hand any leg to stand on. Which meant that I was locked into whatever the credit card company said. "Your account is closed, sir" becomes the only response I can get. Plus my credit history now shows the topper of all punishments: I have no viable credit (since the accounts are closed), the "Late Payment" hits against me look like they are the reason the accounts are closed, and I am "at my limit" for all of my accounts, since by closing them I have lowered the limit to what I owe until it is paid off.

Wow … I feel like I have been violated by a hurricane.

My natural reaction of course is to kick and scream and bite someone on a Customer Service line. But as a person committed to http://www.EverydayAdvocacy, I find that I have to at least try something.

Three ideas come to mind, most of which require Congressional action (just what I need: get the politicians involved. That should help! ):

Laws should exist that prohibit credit lenders from punishing people more than once. If a credit agreement allows for the payment of late fees or over the limit fees, the credit card holder has the right to charge those OR note these transactions on the client's credit history. If the agreement specifies that a paying the fee is the punishment (or the tactic) associated with being late, they should have no right to add the incident to a credit history, any more than would rich folks be punished for using their resources for intelligent planning.

Credit Score Alerts need to be issued whenever it is likely that a transaction will impact one's credit score. Since no one seems to understand how these numbers are actually determined, it is incumbent upon those developing them to tell consumers sufficient information to make an informed choice. If I am late for a payment, for example, why should I not be told what the results are when the damage is inflicted? When I apply for a new credit account, the merchant gets an immediate response about my creditworthiness, giving him or her a leg up on my understanding. Don't we as consumers deserve an instantaneous response?

And finally: Using credit recovery resources should not put us in a worse position than we started at. My credit history shows that my accounts were "closed at the request of the creditor," with no acknowledgement that that request came through a mutual agreement to change the terms of our relationship.

Now why these may not be perfect answers, I can assure you that they are "changes in the terms of agreement" that any passing HurriPain creditor ain't going to find much favor with.