Variable rates are interest rates that are tied to a rate index, usually the “prime rate.” As the government raises or lowers its rate, the variable rate changes as well. And good news: Under new regulations issued in January on variable rate credit cards, interest rates must be allowed to fall, not just rise. Now companies can raise rates on existing balances only when tied to an index and only when allowed to rise and fall with that index. Until then, lenders had used “floors” that allowed the rate to rise, but not to fall beneath a certain minimum rate.

What scares me are the unintended consequences with rates being able to go down, but not up…. That tells me the banks are going to figure out other ways to get what they want.  That is why we need to watch closely.

The rules for how do variable rates work have just changed so that borrowers paying variable rates will enjoy a fall when the prime rate goes down.

For those who haven’t attempted to negotiate their debt yet, but have questions – Submit your questions in the comment section below.

For those that have negotiated your credit card debt, we need your input! -  Simply call (310) 929-0033 and leave a message with your answers to the following questions.  We will take your message, type it out, and post it on our blog with ONLY your first name.  Once again, the questions are:

1. Name of credit card company you were negotiating with
2. Amount of debt
3. Amount settled for
4. What did the credit card company offer you that was “out of the ordinary”  (for example, no payments, no marks on your credit)
5. How did you negotiate this?
6. What are the things you would definitely do again?
7. What are the things you would do differently?

Click “Call Me” below , enter your first name and your phone number and the system will immediately call you and connect you to the voicemail system:

Remember the more specific the better.  If you know someone that does know how to negotiate with credit card companies, please click on “share this” so that we can spread this information!

Thank You!

Here are the facts:  No one regulatory agency exists to monitor behavior and address consumer complaints, so you need to complain or report a violation to the following locations, compliments of Credit Cards.com.

The Federal Reserve oversees some state banks and all banks that are members of the Federal Reserve System.

Toll Free: 1-888-851-1920

TTY: 877-766-8533
Fax: 877-888-2520

Mail: Federal Reserve Consumer Help
PO Box 1200
Minneapolis, MN 55480

Online complaint form: http://www.federalreserveconsumerhelp.gov/?District=13

If the credit card company in question has the word “national” (or the initials “N.A.”) in its name, contact the Office of the Comptroller of the Currency.

Toll Free: 800-613-6743

TDD Number: 713-658-0340

Fax: 713-336-4301

Mail:  Customer Assistance Group,
1301 McKinney Street, Suite 3450
Houston, TX 77010

Online complaint form: https://appsec.helpwithmybank.gov/olcc_form/

If you are dealing with a credit union with the word “federal” in its name, or if the credit union is located in Delaware, South Dakota, Wyoming, or D.C., contact the National Credit Union Administration at 1-800-755-1030.

For state-chartered credit unions not located in Delaware, South Dakota, Wyoming, or D.C., and for state-chartered banks, click here for the appropriate state regulatory agency.

Thrifts, savings, loan associations, and federally chartered savings banks are regulated by the Office of Thrift Supervisors.

Toll Free: 800-842-6929

TTY: 800-877-8339

Fax: 202-906-7342

Mail:  Office of Thrift Supervision
1700 G Street, NW
Washington, DC 20552

Email: consumer.complaint@ots.treas.gov

Regardless of which banking regulator you contact, be sure to keep records. Start by contacting the credit card issuer directly. Record the person’s name, date of the call, and the details of the call. Keep asking to speak with a supervisor until you have exhausted your resources at the credit card company. With your detailed notes in hand, contact the appropriate banking regulator and explain your problem. Per the Credit Card Act of 2009, keeping good records will help expedite a resolution.

The Credit Card Act of 2009 was intended to clamp down on certain practices, such as charging over-limit fees to customers who prefer to have the transaction declined or raising interest rates on current balances even while the account is in good standing, however, we are already seeing the unintended consequences of the government’s new “effective” law.  What is happening is the Act could result in more than $50 billion in lost profits. What do you think is going to happen?  Of course… the banks are going to look for new loopholes to make up for these lost profits, the only way to avoid being taken advantage of is to closely monitor your accounts.

Everyone knows that the interest rates of every American’s credit cards have already gone up and we have talked in previous posts that Bank of America is “testing” new annual fees.   What we don’t know is what may be around the corner.  This is why it is critical to monitor your accounts closely, especially, during the next 12 months.

The thing to remember is that once the law does take effect, expect even more changes. For example, new annual fees and other processing fees may be imposed, as these are ways for creditors to make money. Some banks may even eliminate free checking and start charging fees on accounts that do not maintain minimum balances.

Once again, be sure read everything you receive from your financial institutions, including the small print. And now more than ever, maintain balances you can afford to pay off, which you might need to do if you want to walk away from unfavorable terms. With these thoughts in mind, closely monitor all of your financial accounts as banks seek to make up profits lost in the wake of the Credit Card Act of 2009.

If you have any Credit Card horror stories, please share them below.  The more details the better as this is the only way we can show our elected officials that this is not fair.

Department store credit cards are typically easy to get as there is no income verification.  However, there is a federal proposal requiring department stores to get the income information before a credit card could be awarded.

Now, this could help people who abuse the credit system, however this is a nightmare for the rest of America who use department store credit cards strategically.    Practically, this law makes absolutely no sense – who carries around their paycheck stub or W-2 on a daily basis?

I’ve always maintained that department store credit cards are not good for a person’s finances or their credit score.   However, there are times when a responsible person buying  a big ticket item can save 10-20% by applying for a department store credit card - and that can add up to a lot of money.

Who knows if this new law will pass and there will no longer be department store credit cards that are easy to get, but once again, I sometimes wonder how we have elected the politicians that make absolutely no sense in their actions.

I always get asked, what is the key to Raising My Credit Score Quickly?    I understand why the “quickly” is such an important part of the question.  See – getting denied credit is embarrassing!  Read my story….

Two weeks ago I was in Macy’s buying my wife a Christmas Gift, I was in line, and there were six people behind me.  The total bill was over $700, and if I applied for a Macy’s Credit Card, I could save $140.  I thought to myself…. “I have perfect credit, and I can save $140 for applying for a Macy’s Credit Card, let’s do it!”

I filled out the application, and I could practically feel the breath of the people behind me, in fact, I could hear the voices in their mind saying… “What is he applying for a Macy’s credit card for?  We are too busy!”  Actually, that is probably what I would have been saying as well.

After waiting for the instant approval, the lady told me, “You have not been instantly approved for our Macy’s Credit Card; you need to wait a few minutes, please have a seat.”

“What!”  I thought to myself.  “How can this be?”  I felt like telling them, “I’ve written a book on credit, I have perfect credit.”  In other words, “Accept me!”  As I was sitting next to the cash register hoping and praying that everything was going to turn out for the best, I could barely face the people that were behind me.  Under their breath I could picture them saying things like, “You deserve to be denied this credit card for holding us up!”

Let me tell you, it was the most stressful and embarrassing five minutes of my 2009!  Now I know why people ask me, what is the key to Raising Your Credit Score Quickly?”  That is what I’ll help you do this year, along with a few other things… let’s make 2010 our best year ever.  If you have a story like this, almost getting denied credit, or getting denied credit?  Share it with me below, we can bond together over our frustrations.