0% balance transfer credit cards will be a thing of the past? : Bad Credit Advisor

0% balance transfer credit cards will be a thing of the past?

I certainly hope not as I have tremendous use for every 0% balance transfer credit card I can get my hands on. I hate paying interest, even tax deductible. Often, I am simply amazed by the stupidity of the banks that have tried to suck me into their debt trap for about 4 years now. The only penalty or interest I have paid was $39 fee for going over the limit last August. Was dumb of me, but I am human. True, I also paid $199 for transferring $24,000 from my mortgage, which is less than .83%, and was an obvious thing to do, as otherwise I simply couldn't refinance my 7.25% 30 year fixed mortgage to the 5.125% 5/1 ARM without lowering that mortgage by this $24,000. Transferring it to 0% interest business credit card was as clear of a solution as the blue sky on nice fall day in north woods of Michigan. Now I touched two future subjects - paying off your mortgage with credit cards and using and obtaining business card/credit. Gives me something to write about in a future, but back to the 0% interest balance transfers.

Apparently, over the past several months, our distinguished lawmakers and the honorable Federal Reserve have worked quite feverishly toward new regulations which target the credit card industry. On September 23, the U.S. House of Representatives overwhelmingly voted to pass the Credit Cardholders Bill of Rights, H.R. 5244, drafted to mirror regulations the Federal Reserve is planning to announce this fall. The Senate is not expected to review the bill until after any new Fed rules take effect January 1, but it is very unlikely that it will water down any regulations.

Consumer advocates consider the Credit Cardholders Bill of Rights as tremendously good news for cardholders, as the bill eliminates predatory lending practices like retroactively applying interest rate hikes to balances, and implementing new requirements such as a 45-day notice before raising interest rates.

The credit card issuers of course, don't like the proposed new rules, noting among other things, that because of the greater restrictions, they will no longer be able to afford to offer the enticing teaser rates used to lure consumers in, and many ponder that the law would wipe out all these 0% balance transfer credit card offers in a hurry. And that's precisely what I don't like.

I hope it never comes to the total stoppage, because as I said in the beginning, I love every 0% interest credit card I have, as long as there is no transfer fees, or they are capped at something like $200 range. The best offers normally come from JPMorgan Chase - no fees, and the 0% interest balance transfer deal goes up to 15 months. And JPMC allows you to have few cards simultaneously. Of course, if you miss a payment on one credit card, all the others will probably have the interest rates go up, but as long as you play be the rules, it works like a magic.

Fri Oct 10, 2008 01:10AM by Tony | More in Personal Finance | Comments (0)

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