BigDaddyBry

iTrader: (15)

This is a somewhat misleading comparison.

camkid

right because the mojority of your interest is payed on an auto loan in the fisrt two years.....but your still paying the full amount of the loan + that interest of that amount regaurdless of that balance

chris93266

iTrader: (5)

ok folks here it is short and simple...

intrest is broken down into apr (annual % rate) then divided by 12(monthly % rate). each month you pay off that month's interest and the rest goes to principal. each month as the balance goes down, so does the interest you're paying because the interest is a percentage of the balance(not the total starting loan value). this is how a fully amortized loan works.

there are other options that include a balloon payment at the end of the term, but that's another topic.

camkid

OK WELL IT SEEMS YOU KNOW WHAT YOUR TALKING ABOUT SO SHOULD I DO THE 0% AND THEN FIXED 3%

chris93266

iTrader: (5)

0% then 3% fixed is great as long as there is no hidden fine print switcharoo mumbo jumbo. you just have to have discipline to pay it off and not refi your car when you want cash for stuff... a.k.a mods.

sundaydriver

The economic factor being that THEY CAN RAISE YOUR RATE ANY DAMN TIME THEY WANT. The lending laws as written allow credit card issurers to raise rates at their disceetion. Your rate may even be raised for late payments or missed payments on other cards that raise your risk ranking.
keep that 9% and pay a little extra when you can. And whatta mean you don't even know your credit limit?

we_todd_did

iTrader: (97)

Oh pay it off then after the 0% is over fill brankrupcy and keep the car for free boo yah

black_knight

iTrader: (1)

You're talking about APR vs APY.

APY is the total percentage of interest you are paying when compounding is taken into consideration. So if it's 3% APR, it may indeed be a higher APY.

But 0% is 0%. If you pay it off before it goes above 0, then you're solid.

black_knight

iTrader: (1)

That's only after the 0% is up. If you make all your payments on time, it has to stay 0 for the agreed duration.

The key is that you have to be ready to pay when the 0% is up. If you spend all your spare money on instant lottery tickets and don't have the bank to pay it off when the 0% runs out, then yeah you should fear credit cards.

But if you have half a brain, there's no reason to fear.

GoldenBird

I probably wouldn't want the risk of having to pay off a nice car on my credit card...but I've often wondered how you deal with the BS if you want to sell your car while there's still a loan on it, and essentially need the buyers money to pay off the loan. I hadn't even thought of a credit card but that's a great way to get the title and a month buffer zone to float the money. Not to mention like a $100 gas card worth of reward points.

JustAnIlluzion

iTrader: (60)

sounds like a good idea, update us with what u do

camkid

aww **** good one!!!!! i ahve another card with flyer miles

camkid

no they cant, if it is a fixed rate after the zero% they cannot raise the limit unless you breach the contract by making late paymnets. I WORKED FOR CITI BANK! IM SURE ITS A FIXED RATE!

....EVEN IF YOU ARE DEFAULT ON ANOTHER CARD THEY CANNOT RAISE A FIXED RATE! UNLESS YOU SOMEHOW BREACH THE CONTRACT ON THAT PERTICULAR CARD

the only rate than can fluxuate are variable rates, which are very common. those rates are calculated on a daily basis and are very sensitive to economic factors.....for instance citi bank uses the dowjones for its information on deciding factors. THEY DO NOT JUST RAISE THE RATES FOR THE HELL OF IT, THEY RAISE THEM AND HAVE EVIDENCE TO BACK IT UP FROM MAJOR ECONOMIC PLAYERS TO AVOID A LAW SUITE.....but yes as long as you follow the contract the only rates that can change are variable rates which are based on the prime rate(anywhere from 3.5-13.5%) + the variable rate(economic factors.... anywhere from 7-13%)

JohnnyC

This is not true-the law states that credit card companies can raise even a fixed rate, but they need to give you 15 days notice (read your contract). This has happened to me. Bottom line - stick with the 9% loan and save yourself alot of grief and credit problems. Check out this link:

http://www.truthaboutcredit.org/roadmap.pdf

black_knight

iTrader: (1)

I'd be interested to know where the law says that. If it says 0% fixed rate until this date, then that is what it is. Yes, there is an asterix but it only says you have to make your payments on time.

Camkid, as I said, I have personally and successfully done what you propose (within the 0% term), including the transferring to another 0% card at the end of the term. It works very well, just make your payments and have the bank to back it up.

camkid

IT IS TRUE! if a corp raised a fixed rate they violated TILA laws and statutes. You should have taken it to a class action suit, in the following paragraph there is a spicific instance in which this happend. The case was originally dismissed and then reraised to the final decision awarded to the plaintiff. It is now common practice after this decision.

Credit card provider that raised interest rate after promising fixed rate in solicitation materials may have violated TILA
Law Reporter, Dec 2003

Find More Results for: "fixed credit card rate law "
Bi-Lo to offer its own...
Notice of interest...
Credit-Card Capers -...
Homeowners hit hard as...
Roberts v. Fleet Bank, 342 F.3d 260 (3d Cir. 2003).

The Third Circuit Court of Appeals held a credit card provider may have violated the Truth in Lending Act (TILA), 15 U.S.C. §§ 1601 et seq., by raising a credit card's interest rate after solicitation materials promised a fixed rate.

Here, Roberts received a packet of materials from a credit card company advertising a credit card with a fixed interest rate. The materials noted two specific circumstances that might cause the rate to change: (1) if the cardholder failed to repay or (2) the account was closed. Roberts obtained the card and received the company's "cardholder agreement" stating that it could change the terms of the agreement at any time. About one year later, the company raised the interest rate.

Roberts filed a class action against the company, alleging it violated TILA. The trial court granted defendant's motion to dismiss, finding that defendant had not violated TILA's disclosure requirements.


Reversing, the Third Circuit noted that the act's purpose is to assure a meaningful disclosure of credit terms to enable consumers to compare terms and protect against unfair credit card practices. The act requires credit card providers to clearly and conspicuously disclose-in a tabular format referred to as a Schumer Box-certain information in solicitations, including annual percentage rates.

The court noted that defendant, in the Schumer Box included in the solicitation materials, stated only that the percentage rate could change under two conditions. The court said it was at least as reasonable for a consumer to conclude from this information that the interest rate could be changed only under certain conditions as it would be to conclude defendant could change the interest rate at any time. Thus, plaintiff has raised a genuine issue of material fact as to the adequacy of defendant's disclosures.

The court rejected defendant's argument that the clear and conspicuous standard only applies to required disclosures in the initial disclosure statement and Schumer Box. When Congress decided to require credit card providers to disclose terms in a clear and conspicuous manner, it is doubtful it intended courts to ignore other statements made by issuers in their solicitation materials. Because the act's purpose is to ensure meaningful disclosures, it prohibits not only literal falsities but also misleading statements. Thus, although the court recognized that the clear and conspicuous standard only applies to required disclosures, it found that the act does permit consideration of materials outside of the Schumer Box in determining whether the provider disclosed the required information.

The court also rejected defendant's argument that the cardholder agreement gives it the right to change any terms of the agreement at any time. This provision fails to remedy the defects in the initial mailing, the court explained, because that agreement is only mailed after the consumer has accepted the offer. Therefore, a consumer will not learn until after acceptance that the rate can be changed at any time. Consequently, defendant's practice of mailing the agreement containing crucial rate change information only after the consumer accepts the offer is contrary to the TILA mandate that solicitations disclose all required information, the court concluded.

Plaintiffs' Counsel

Ira Neil Richards,

Gary M. Goldstein,

Roberta D. Liebenberg, and

Mary L. Russell, all of Philadelphia, Pa.

Marc H. Edelson, Doylestown, Pa.

Copyright Association of Trial Lawyers of America Dec 2003
Provided by ProQuest Information and Learning Company. All rights Reserved

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camkid

THE 15 DAYS NOTICE IS TRUE, BUT WHAT THAT MEANS IS THAT YOU CAN ACCEPT OR REJECT THE TERMS SENT TO YOU IN THE MAIL, IF YOU ACCEPT YOU ACCEPT THE NEW % RATE FOR PURCHASES ON THE CARD. IF YOU REJECT YOU CAN NO LONGER MAKE PURCHASES ON THE CARD, BUT YOUR EXISTING BALANCE IS CONTINUAL AT THE PROMISED % RATE


IF THEY CHANGE THE CREDIT TERMS AND AGREEMENTS WITHOUT YOUR CONCENT ON YOUR EXISTING BALANCE ITS A VIOLATION OF TILA REGULATIONS AND GROUNDS FOR A CIVIL CASE

BigDaddyBry

iTrader: (15)

Camkid, you are misinterpreting that ruling. For one, that ruling pertains to situations where the cardholder agreement arrived after acceptance of the offer.

You are missing what JohnnyC and others are telling you. Don't just read the offer letter that states "0% for life". Read the accompanying 8+ pages of the credit card agreement (if you received one). This is where the credit card company provides a way out for themselves by stating they can change the fixed rate terms if certain conditions are met. Yes, one will be if you make a late payment, others are not so simple and are not as well-defined (other economic factors). If this is not written in the agreement, then you are fine. But what we are telling you is to read through it to cover yourself.

camkid

THAT IS THE WHOLE ARGUMENT HAHHAHAHA!!! im not misreading anything...thats the whole point is that a company cannot change the terms that you originally accepted if there i already a balance on those terms!


WHAT JOHNNYC IS SAYING HAPPEND TO HIM IS UNLAWFUL AND HE SHOULD HAVE BROUGHT IT TO COURT! im not missing what he is saying becuase i have seen it working for a credit card agency, but there are strict rules and regulations now that prohibit that kind of situation from happening. Its called false advertising or under the table statments. In which a company uses frivilious verbage or an ungodly amount of paperwork to accompany the terms in order to fool the customer into accepting an offer that seems good but is not at all.

Point being is that i already have the card and its 0% for 2 years on purchases when the first purchase is made( i know this for a fact). there are no ways for a credit card company to get around that becasue that is false advertising....and thats what that whole case in the above post was about, that a credit card company must honor the advertisment that they mail or state no matter the curcimstance. In other words a credit card company or any company in that case can not offer a 0% anything for a "PERIOD OF TIME" without providing 0% for that offer......sure there can be exceptions to that in that if you default or what not but thats not the case, if you are offered it they can not change it PERIOD! unless you breach the contract for some reason.

anyways im not trying to argue im letting people know that there are customer rights that prohibit these bad situations

all in all yes you should read all paperwork before you sign I KNOW THAT.... but you as a customer have rights against a breach in terms

camkid

oh and i already have the card with 0% for 2 years and the FIXED INTEREST RATE OF 3% AFTER THAT...(not variable interest rate, not daily average balance, not tear interest and not grouping interest) its a citibank plat if anyone is wondering, but i have requested a couple of credit increases to get to 20k.....

anyway i see why everone is scared of credit cards, they destroy many individuals credit I saw it all the time......but the reson they do is becuase the people are irresponsible with them. They are a great tool to use to get out of debt of to even use for purchases I have also seen this alot. All in all if you are of feel that you cannot upkeep the terms on a credit card then stay away from them and use another debt alternitive, all im saying is that they can be used for good reasons and situations LIKE MINE! but again they are not for everyone