LowCards.com Weekly Credit Card Update January 25

LowCards.com Weekly Credit Card Update January 25

January 25, 2013         Written By Lynn Oldshue

With Cordray Nomination, Obama Renews Fight With GOP

President Obama renominated Richard Cordray for head of the Consumer Financial Protection Bureau on Thursday. Cordray is currently serving in the post thanks to a recess appointment. A year and a half ago, Obama passed over Elizabeth Warren to nominate Cordray for the same position, but the real controversy came as Republicans repeatedly blocked Cordray’s nomination. After six months of partisan bickering in Congress, Obama invoked executive authority to put Cordray in place. Story by Sarah Parnass for ABC News.

The Rising Cost of Travel Rewards

Banks are now placing renewed attention on travel cards. In their latest promotions, banks are offering more introductory points or miles to consumers who sign up for the cards and spend a set amount in the first few weeks. Next month, U.S. Bank will raise the initial bonus points on its FlexPerks Travel Rewards Visa Signature card, its second increase in the last year. There’s a catch for cardholders, they’ll need to spend more than in the past to get the rewards. Story by AnnaMaria Andriotis for MarketWatch.

Discover Hopes Old Debit Cards Become New Again

Discover is moving forward with an effort to reintroduce a signature debit card. Discover executives said the new card’s increased flexibility as well as greater transparency and simplicity are reasons credit unions might be interested in issuing their card. For example, where other card brands insisted that their brand symbols appeared on the front of debit cards, Discover doesn’t mind if a bank or credit union wants to put the Discover brand on the back. Story by David Morrison for Credit Union Times.

Protect Yourself Against Card Skimmers

Card skimming is now a sophisticated crime that can happen anywhere you swipe your credit or debit card. Thieves can insert a skimmer into the card reader sleeve and a hide a tiny camera nearby to record PIN numbers. There are usually no signs that your card was skimmed. A skimmer can look like part of the ATM. After the card is swiped, the data on the magnetic stripe is picked by the skimmer’s card reader. It can then be stored on the memory of the skimmer device or wirelessly transmitted to a secondary location. The camera can be smaller than an eraser head and also look like part of the machine. Memory cards can store video footage and details of thousands of unknowing bank customers. Story by Bill Hardekopf for LowCards.com.

Credit Cards and Restaurants Mull Cashless Dining Consequences

Dining out is quickly becoming a cashless experience–92 percent of full-service restaurants now take cards. Last year, 81 percent of the money spent at full-service restaurants in America was charged to debit, credit or pre-paid cards, up from 72 percent in 2006 and 66 percent in 2004. At quick-service restaurants, just 37 percent of sales were charged in 2012, but the trend toward plastic is the same. At the same time, customers’ insistence that restaurants take cards has allowed companies like Visa, MasterCard and American Express to charge ever-higher merchant fees. These fees often range from 2 percent to 3.5 percent of the bill–a significant chunk to a restaurateur running a business with a profit margin in the mid-single digits. Story by Joe Satran for the Huffington Post.

Credit Card Penalty Fees Fall for Third Straight Year

A new report shows consumers paid $17.8 billion in penalty fees on their credit cards last year, an 8 percent decline from the $19.4 billion in 2011. Fees have fallen for three consecutive years, ever since the CARD Act was passed in May of 2009. That legislation put restrictions on the dollar amount of late fees and prohibited issuers from automatically charging an over-the-limit fee when a cardholder exceeded the credit limit; that fee can only be charged if a consumer “opts in” to allow these transactions to go through and pay the penalty. Story by Bill Hardekopf for LowCards.com.

Still More Mortgage Protections Unveiled

Last week, the government announced more rules designed to protect borrowers. The Consumer Financial Protection Bureau barred lenders from paying brokers and loan officers based on the terms of the loan they sell, such as by steering customers into loans with higher interest rates, fatter fees or prepayment penalties. The bank or lender originating the loan can’t get paid more for selling related products, like title insurance, from affiliated companies. Also, the agency made it clear that borrowers were entitled to receive a free copy of the appraisal on which their loan was based, before the loan is finalized. That way, borrowers can see the value placed on the property that is securing the mortgage. Story by Ann Carrns for the New York Times.

DC Cabs Must Take Credit Cards By March 31

All District taxis must be able to accept credit cards by March 31. The DC Taxicab Commission is set to approve regulations that will require cabs to either install credit card swipers or sign up with a digital dispatch service which accept riders’ credit cards via smartphone. Last year, the city rolled out a plan to have all city cabs install “smart meters” but the plan stalled after a court sustained a protest saying that the city had botched the meter contract. Story by Liz Essley for the Washington Examiner.

LowCards.com Weekly Credit Card Rate Report

Based on the 1000+ cards in the LowCards.com Complete Credit Card Index, the average advertised APR for credit cards is 14.32 percent, identical to last week. Six months ago, the average was 14.35 percent. One year ago, the average was 14.17 percent.

The information contained within this article was accurate as of January 25, 2013. For up-to-date
information on any of the terms, cards or offers mentioned above, visit the issuer's website.


About Lynn Oldshue

Lynn Oldshue has written personal finance stories for LowCards.com for twelve years. She majored in public relations at Mississippi State University.
View all posts by Lynn Oldshue