LowCards.com Weekly Credit Card Update–August 15, 2014
Debt Collectors, What are Their Legal Limits?
Collectors call again and again in the middle of dinner. They call the wrong person. They threaten. They take advantage of the latest technology to embarrass people. Often, they violate the law. Debt collectors will go to all sorts of legal and illegal means to intimidate people who owe or allegedly owe money. Collection has become a multi-billion dollar business, especially in the last few years as the slow economy had caused people to fall behind on payments. About 30 million Americans were saddled with debt or alleged debt in collection in 2012, averaging about $1,500 according to the CFPB. Yet the hodge-podge regulatory system over debt collection abuse fails to protect the harassed as law has fallen behind technology and the extent of the problem. Story by Charles Pekow for the Los Angeles Post Examiner.
Credit Scores Could Rise with FICO’s New Model
The creator of one of the most widely used and influential credit scores, FICO, said that the latest version of its score would no longer weigh medical debts–which account for about half of all unpaid collections on consumers’ credit reports–as heavily as it did in previous iterations. The newer FICO scores, available this fall, will also ignore any collections that have already been paid; previously, the scores factored paid and unpaid collections equally, though it ignored amounts under $100. Story by Tara Siegal Bernard for the New York Times.
Mobile Payments Will Make Credit and ATM Cards Almost Obsolete
Eight-track tapes, rotary phones, videocassette recorders. Think of outdated technologies and these probably spring to mind. Will plastic cards eventually join the list? Certainly the demise of credit and debit cards isn’t imminent, but they’re going to begin to lose their appeal in a world where transactions can increasingly be done by smartphone. With payments more and more going mobile, retailers, banks, card companies, phone operators and just about everyone in between are scrambling for position. Mobile payments will hit $720 billion a year by 2017, up from $235 billion last year, according to the research firm Gartner. Story by Matthew Friend for Forbes.
A Line of Defense Against the Theft of Personal Data
The pattern with credit and debit card breaches tends to go something like this: A company like Target or Neiman Marcus announces that thieves may have stolen your card numbers or other information, then the company offers a year of credit-monitoring. But the chastened keeper of your personal data rarely if ever offers to pay for the most potent protection of all: a security freeze on the files that the three big credit bureaus keep on you. Credit-monitoring is often backward-looking, informing you of new accounts that thieves may have already opened in your name. But a freeze prohibits the bureaus from releasing your credit reports to any company or other entity that doesn’t already have a relationship with you. Story by Ron Lieber for The New York Times.
Consumer Financial Protection Bureau Warns on Bitcoins
Bitcoin is in the cross hairs of another federal agency. On Monday, the Consumer Financial Protection Bureau issued its first consumer advisory on virtual currencies, including Bitcoin, and said it would begin accepting complaints about such issues or companies.The agency warns consumers to be aware of hackers and schemes, volatile exchange rates and a lack of government protection. “Virtual currencies may have potential benefits but consumers need to be cautious and they need to be asking the right questions,” Richard Cordray, the director of the bureau, said in a statement. “Virtual currencies are not backed by any government or central bank, and at this point, consumers are stepping into the Wild West when they engage in the market.” Story by Sydney Ember for The New York Times.
Smart Credit Cards Don’t Make Up for Dumb Credit Card Readers
Chip and PIN credit cards are thought to be the solution for credit card security issues in the United States, but hacking experts have recently revealed those accounts may be more vulnerable than we think. The smart cards themselves may be fully protected, but the machines that process them are fairly simple to hack. Chip and PIN credit card readers work by encrypting PIN numbers and not storing credit card data. This is what will ideally keep criminals from obtaining your card information. However, the researchers at MWR Labs found they were able to make the machines work against their instincts, storing both card numbers and PINs for someone to steal. Story by Lynn Oldshue for LowCards.com.
How to Protect Your Finances from Cyber Hackers
It seems that every few days we hear about another cyber-hacking case. Last week, reports of a Russian cybercrime group amassing 1.2 billion usernames and passwords ran above the fold in The New York Times. The news was pretty unnerving. Breaches are happening all around you. You can’t protect yourself completely. But you can make yourself much safer by doing these four things. Story by Jean Chatzky and Kelly Hultgren for Fortune.
LowCards.com Weekly Credit Card Rate Report
Based on the 1,000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.47 percent, identical to last week. Six months ago, the average was 14.48 percent. One year ago, the average was 14.36 percent.