LowCards.com Weekly Credit Card Update–May 30, 2014
Correcting Your Credit Report Gets Easier
You just got more of a say in fixing errors on your credit report. Pushed by the Consumer Financial Protection Bureau, major credit reporting companies Equifax, Experian, and TransUnion have changed their complaint systems to let people dispute reports’ mistakes in greater detail. Now when you provide documents, the agencies have to forward that material to the creditor, letting you state your full case. The creditor then has to fix any errors with all three agencies, which received about 8 million complaints about errors in 2011. Story by Alizah Salario for CNN Money.
Consumers are Back to Paying Mortgages Ahead of Credit Cards
Americans are putting their mortgages ahead of their credit cards when they pay the bills, reversing an unusual pattern that had developed after the housing bust. As home values plunged during the downturn, consumers began to default on their mortgages while continuing to make credit card payments, according to research from TransUnion, reversing a long-standing hierarchy in which lenders expected mortgages to be paid first. Story by Nick Timiraos for The Wall Street Journal.
Will the Apple iWatch be a Revolutionary New Payment System?
The Apple Worldwide Developers Conference in San Francisco begins on June 2 and everything from Apple TV to the Beats acquisition has been mentioned as possible groundbreaking announcements. One of the latest rumors has an Apple iWatch with an NFC (near field communication) chip being introduced at this conference. This might not sound like a big deal, but it could be the start of the largest revolution in financial payments since the credit card. Story by Bill Hardekopf for LowCards.com.
The Ripple Effects of Rising Student Debt
What are the roads not taken because students must take out loans for college? A collection of studies shows that the burden of student debt may well cause people to make different decisions than they would otherwise–affecting not just individual lives but also the entire economy. For one thing, it appears that people with student loans are less likely to start businesses of their own. A new study has found that areas with higher relative growth in student debt show lower growth in the formation of small businesses, in this case, firms with one to four employees. Story by Phyllis Korkki for the New York Times.
Visa, MasterCard Renew Push for Chips in Credit Cards
Visa and MasterCard are renewing a push to speed the adoption of microchips into U.S. credit and debit cards in the wake of recent high-profile data breaches, including this week’s revelation that hackers stole consumer data from eBay’s computer systems. Card processing companies argue that a move away from the black magnetic strips on the backs of credit cards would eliminate a substantial amount of U.S. credit card fraud. They say it’s time to offer U.S. consumers the greater protections microchips provide by joining Canada, Mexico and most of Western Europe in using cards with the more advanced technology. Story by Bree Fowler for the Associated Press.
CARD Act Fixed Many Abusive Practices, But Not All
The Credit Card Accountability, Responsibility, and Disclosure Act, landmark legislation to clean up the credit card industry, was signed into law five years ago and has since shed light on the once opaque pricing structure that allowed card companies to put the screws on customers. But for all that the legislation has accomplished, it has failed to prevent credit card companies from peddling useless debt-protection products and murky promotional financing deals. And the law did not address many of the same eyebrow-raising antics in the debit card market. Industry lobbying resulted in carve-outs for bank-issued debit cards and prepaid debit cards, which continue have minimal consumer protections. Story by Danielle Douglas for Boston Globe.
MasterCard Takes Steps to Boost Cardholder Security
MasterCard said it has taken steps to boost security for its cardholders, a move that comes amid several recent data breaches at high-profile companies, such as Target. MasterCard said all of its credit, debit, prepaid and small-business cards issued in the U.S. will now come with the company’s identity theft resolution assistance, which helps cancel missing cards and alert credit reporting agencies. Additionally, the program helps detect if customers’ personal data have appeared online. The company also extended its zero-liability policy to PIN-based and ATM transactions in the U.S. in the event cards are illegally used. Story by Michael Calia for The Wall Street Journal.
Nordstrom Said to Gauge Banks Interest in Its Credit Cards
Nordstrom, which is exploring a sale of its store-branded credit cards, has begun reaching out to potential buyers including Capital One and Toronto-Dominion Bank to gauge their interest, according to people familiar with the matter. The retailer has also approached Citigroup and JPMorgan Chase. Nordstrom is informally canvassing buyers of the $2 billion portfolio of credit card receivables and hasn’t yet set a date to solicit initial offers. Story by Matthew Monks for Bloomberg.
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 14.45 percent, slightly lower than last week’s 14.47 percent. Six months ago, the average was 14.42 percent. One year ago, the average was 14.27 percent.