The Conservative Cave
Current Events => The DUmpster => Topic started by: franksolich on March 09, 2008, 08:03:32 AM
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http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x2973088
Oh my.
Another wannabe literary primitive:
JDPriestly (1000+ posts) Fri Mar-07-08 04:16 PM
Original message
151.73% Effective Annual Percentage Rate on my credit card.
I was in a hurry and, by mistake inserted the wrong credit card in my ATM machine. As a result, I made a cash advance rather than a withdrawal. I had never made a cash advance and did not think about what button I was clicking on. I was charged $2.00 over the amount of money I received plus a $10.00 service charge. Mind you, we always pay the full amount of charges on our monthly credit card charges. We never carry over any amount due and therefore never owe interest.
When our bill arrived last month, we paid the full amount on the bill. When the bill arrived this month, the cash advance charges appeared and, surprise, we also had a finance charge on the amount due. The interest rate was shown as 21.99% on cash advances or $1.23 for that month. The effective annual percentage rate is 151.73%. I REPEAT 151.73%.
Please understand, if we continue to pay the amount billed us each month, these credit charges will continue to accrue -- for eternity. When we pay our bill in full as usual, our payment will be applied to the existing amounts due, and we will be charged 151.73% effective APR on any amount we have charged since the issuance of the last statement. The only way we can stop the continued accrual of interest on interest is to pay ahead, i.e., more than the amount shown on our statement, stop using the card or call the bank, get a specific day's balance and make an immediate bank transfer, plus, for the sake of safety, an additional sum.
Folks, 151.73% effective annual percentage rate. Is it any wonder that busy American families are in debt way over their heads? An interest rate of 151.73% is criminal. It's usury. The Mafia would not dare charge 151.73% effective annual percentage rate.
I guess I'm naive, but I had no idea that the banks were this bad. (And, by the way, the bank gets to borrow its money at what 3% and pays may be 4.25% maximum on our savings accounts?) Again, this is criminal.
Folks, a Congress that doesn't outlaw an interest rate of 151.73% is not serving the common good. Every member of Congress deserves to be booted for allowing this kind of crime to go unpunished, this kind of abuse to remain legal.
And then the wealthy blame ordinary Americans for accruing too much debt. DUers, forget about the popularity contest between Hillary and Obama. Can't we focus on something that matters like the credit card company crime in the United States? Can we start a DU campaign to get justice in our banking system?
I dunno.
flvegan (1000+ posts) Fri Mar-07-08 04:19 PM
Response to Original message
3. I'm missing how you got to 151.73%.
21.99% is the APR on the cash advance. Maybe I'm reading this wrong.
Crabby Appleton (1000+ posts) Fri Mar-07-08 04:57 PM
Response to Reply #3
7. Me too.
GreenJ (1000+ posts) Fri Mar-07-08 07:46 PM
Response to Reply #3
14. One time fees get added to interest to figure out the "effective apr" for a one month period.
JDPriestly (1000+ posts) Fri Mar-07-08 10:53 PM
Response to Reply #3
31. That is what my credit card statement says:
Effective Annual Percentage Rate (APR): 151.73%
My husband called and asked why that disclosure was on the bill, and the service representative said to him that the bank only prints that on the statement because the government requires them to. We are not so poor that we can't pay it off. That is not the issue. It's that the interest rate of 21.99% actually translates somehow into an effective APR of 151.73% (perhaps because interest accrues on interest). Most people don't have the time, and many people don't have the money to watch their bills and correct a subtle charge or understand that a finance charge will continue to accrue for ever unless they handle it very cleverly.
It's a pretty big bonfire, but I concentrated on bringing only the primitive comments dealing with how the interest was calculated.
I haven't pull out the calculator to figure out what it really is; one can't take the primitives' word on it any more than what one can take the primitives' word on anything, including the weather.
The primitives squibble-squabble about a lot of other things too.
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Most people don't have the time, and many people don't have the money to watch their bills and correct a subtle charge or understand that a finance charge will continue to accrue for ever unless they handle it very cleverly.
What?????? People don't have the time OR MONEY to "watch their bills". That's the silliest statement I have read in a long time.
I hope people have time to wipe their butts.
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Having and using credit cards is not rocket science.
Every Friday morning I go into each one and either make sure the balance is at 0 or if not pay it to 0 or a portion of it that will allow it to be 0 before any interest is charged.
The one exception is a larger purchase that I had which I transferred to a new card to take advantage of a 0% offer.
That one I reduce by a regular amount every week.
I have several cards,use a very few of them and last I looked a FICO score over 800.
It can be done but takes responsibility.
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As with 99.99% of all things DUmmy, the OP is incorrect.
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Im not buying it -- Who is dumb enough to use the same PIN code on multiple cards ? Oh wait..Nevermind.
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Interesting that some DUmmies are all up in arms over ATM fees which are a few dollars, but not taxes which are in the thousands.
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Im not buying it -- Who is dumb enough to use the same PIN code on multiple cards ? Oh wait..Nevermind.
"That's the same combination I have on my luggage!"
:rotf:
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I was in a hurry and, by mistake inserted the wrong credit card in my ATM machine. As a result, I made a cash advance rather than a withdrawal. I had never made a cash advance and did not think about what button I was clicking on.
I can`t speak for all but from the ones I have and those I handle at work most debit cards have a very different appearance then a credit card.
Not impossible to mistake but also noticeable.
Since I have never used a credit card in an ATM I can`t speak to it but am I wrong in assuming that there is probably a warning or a "button" to agree to that explains the interest charged on a cash advance (loan) from a credit card?
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Im not buying it -- Who is dumb enough to use the same PIN code on multiple cards ? Oh wait..Nevermind.
"That's the same combination I have on my luggage!"
:rotf:
So the combination is one, two, three, four, five? That's the stupidest combination I've ever heard in my life! The kind of thing an idiot would have on his luggage!
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Im not buying it -- Who is dumb enough to use the same PIN code on multiple cards ? Oh wait..Nevermind.
"That's the same combination I have on my luggage!"
:rotf:
So the combination is one, two, three, four, five? That's the stupidest combination I've ever heard in my life! The kind of thing an idiot would have on his luggage!
:rotf: :rotf: :rotf: :rotf:
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Im not buying it -- Who is dumb enough to use the same PIN code on multiple cards ? Oh wait..Nevermind.
"That's the same combination I have on my luggage!"
:rotf:
So the combination is one, two, three, four, five? That's the stupidest combination I've ever heard in my life! The kind of thing an idiot would have on his luggage!
I seem to remember that Airwolf's quote came {i}before{/i] Chris' quote in the movie . . . :p