Credit Card Companies Racing To Increase Profits Before Reform Legislation Becomes Law by Kathleen Munden

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Even though Congress passed sweeping credit card reform legislation this month, it does not go into effect for almost a year. That gives credit card companies plenty of time to devise new methods for squeezing profits out of consumers while they still have free rein.

For instance, JP Morgan Chase recently raised minimum payments on many of its accounts from 2% to 5% per month. That means that a customer who has been required to make minimum payments of $300 per month is now faced with paying $750. The accounts Chase targeted were those with the most favorable interest rates, fixed at under 5%. Many consumers feel this change was made in an effort to force a late payment from them, which would entitle Chase to raise interest rates on their accounts. In a story by MSNBC, one consumer stated, “They don’t want people to have 5% loans out forever and ever.”

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