LowCards.com Weekly Credit Card Update–May 17, 2013

May 17, 2013, Written By Lynn Oldshue
LowCards.com Weekly Credit Card Update–May 17, 2013

The Long Shadow of Bad Credit in Job Search
Over the last several decades, credit reporting bureaus have been selling their services to a much wider range of buyers than just banks.  Nearly half of employers use credit checks when making a hiring decision, according to a 2012 survey by the Society for Human Resource Management. Most businesses use credit checks only to screen for certain positions, but one in eight, the survey found, does a credit check before every hire. Story by Gary Rivlin for The New York Times.

Bank of America Cuts 2 Million Customers Loose
It used to be that if you gave your bank more business, they would reward your loyalty with better deals. Maintain a higher balance or, better yet, take out a home loan to avoid checking-account fees. As of this month, however, about two million Bank of America mortgage customers are scrambling to figure out their status after the bank sold servicing rights to their accounts to a company called Nationstar Mortgage. The benefits the BofA customers might have enjoyed because of their mortgages soon will disappear. After a 12-month grace period, the bank says, fees will kick in for various services that might have been covered by a customer’s home loan. Story by David Lazarus for the LA Times.

$45 Million Theft Underscores Hazards of Prepaid Cards
Federal prosecutors charged eight individuals in New York with cyber attacks on the global financial system. They were part of an international cyber ring that hacked into a database of prepaid debit cards and stole $45 million from ATMs around the world. Prepaid cards have fewer protections and regulations than credit and debit cards issued by a bank. They do not provide information about credit history or individual behavior which makes them a good option for people with bad credit or no bank account–but also for thieves and crime rings. Story by Bill Hardekopf for LowCards.com.

Cordray Consumer Bureau Nomination Gets Vote Next Week
The U.S. Senate will vote next week on whether to advance Richard Cordray’s confirmation to lead the CFPB. Cordray will face a vote from the full Senate amid opposition from Republicans seeking changes to the agency’s structure and funding. More than 40 Republican senators have pledged to block a floor vote on any nominee to run the consumer bureau until Democrats agree to make changes including restructuring the agency to be run by a commission and the budget must go through the congressional appropriations process. Story by Cheyenne Hopkins for Bloomberg Businessweek.

Great Recession Will Haunt Millions Into Their Retirement Years
The Great Recession hurt a lot of people and this loss of wealth will follow millions into retirement, according to a report by Pew Charitable Trusts. Early baby boomers (those born between 1946 and 1955) may be “the last group on track to retire with enough savings to maintain their financial security through their golden years.” The study shows that early boomers lost 28 percent of their median net worth; late boomers (born between 1956 and 1965) lost 25 percent from 2007 to 2010. However, Gen-Xers lost nearly half (45 percent) of their wealth–about $33,000 on average–during that same time period. And they didn’t have that much savings to begin with. Story by Herb Weisbaum for Today.

Visa Europe Proposes Fee Cut to Appease EU Regulators
In a move that could resolve a long-running anti-trust probe by European Union regulators, Visa Europe has proposed cutting some of the fees it charges for the use of its credit cards  The European Commission said Visa Europe is proposing to cap its so-called interbank fees for credit card payments to 0.3% of the value of transaction–representing a cut of about 40%-60%–for international transactions, as well as domestic ones in 10 countries. Visa Europe will allow banks to apply reduced fees for international transactions, a commitment that the commission said could lead to “considerably lower rates.” Story by Alessandro Torello for The Wall Street Journal.

JPMorgan Says It Faces Enforcement Hit on Consumer Products
JPMorgan Chase said it will face enforcement action from federal regulators over its collection practices and add-on products commonly appended to credit cards and it “expects that its banking supervisors will in the future continue to take more formal enforcement actions against the firm.” Banks including JPMorgan and Bank of America stopped offering such add-on products entirely in the face of regulatory scrutiny. The bureau’s first enforcement action was against Capital One, which paid about $210 million in restitution and penalties over the products. Story by Bloomberg News.

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 14.26 percent, slightly above last week’s average of 14.25 percent. Six months ago, the average was 14.29 percent. One year ago, the average was 14.29 percent.

The information contained within this article was accurate as of May 17, 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