Debt Crisis Causing Credit Chaos
1st December 2007
Research by Money Facts has revealed that in the last 8 weeks, 125 fee and rate increases have hit the credit card market. The need for effective debt management is greater than ever.
The Cost of Using Credit Cards is Rocketing
Credit cards have been affected greatly by rising charges, in particular:
- increased cash withdrawal fees and rates
- increased foreign usage charges
- increased balance transfer fees
- higher purchase rates.
A lot of credit cards have also introduced a combination of these fee and rate increases.
The Scale of the Crisis
The credit crunch is beginning to cause credit card chaos, with 125 credit card fee and rate increases inside 8 weeks! With most of the increases avoiding the headline credit card purchase rates, these fee and rate increases are often hidden in lengthy credit card terms and conditions. However they can still make a large increase to the cost of using your credit card.
Debt Management Top Tip
- Stop withdrawing cash from your credit cards unless you have no other choice.
Interest rates average around 23%, and get charged from the withdrawal date. On top of that, expect to pay a fee of around 3%.
Withdrawing £500 on your card and making minimum repayments, which are 2.5%, you would end up paying £1382.70. £882.70 Interest over 20 years and 4 Months!
Testimonials
I want to thank MRA for all the advice and help you gave me when I was contemplating bankruptcy ...
Mr S., East Barnet, HertsWhat impressed me was the understanding and empathy shown by the MRA debt counsellor who dealt rapidly with all the obstacles that my Bank and Building Society bombarded me through my letter box ...
Littlehampton, West SussexMy debts are almost paid off and I feel happy again.
Mr & Mrs F, EastbourneAre you an MRA customer? Add your testimonial here