Don't be Shy Theresa

[Debra]

Have a read of this: https://www.theguardian.com/business/2017/jan/04/uk-credit-cards-borrowing-debt-economic-crash-fears

Looks like another crash is looming to me.  Inflation going up and not just credit card debt but mortgage debt high.  What happens if the Bank of England put interest rates back up to a more normal level?  So far, they daren't. 

The government does nothing about savings institutions paying next to nothing on people's savings and yet banks charging 20% interest on credit card debt.  When did that happen?  I remember credit card interest rates being a few  per cent above the base rate (and often the same as a personal loan or only slightly  higher, unless you were so well off that you didn't really need a loan).  Now, with the base rate at 0.25%, the banks charge 20% on credit card debt?

There is this ridiculous situation where people are stuck on rates of 5 or 6% for their mortgages, being unable to remortgage at a lower rate because the new mortgage lending regulations say they can't afford it.  Can't afford a mortgage that would mean they'd be paying less than they are now?  Similarly to credit card charges, I remember my mortgage rate being only 1-2% above the base rate on a variable rate mortgage - they can be 5 or 6% above it now.  The banks that caused the crisis are still behaving abominably but are getting away with it and making good profits out of all this.

[Chancer]

I agree with everything but your memory of credit card interest being a liitle over bank rate, whilst I have not borrowed on a credit card for décades I'm pretty sure it was always at least 2% per month, 24+% APR

[DraytonBoy]

Debra, Labour plans to renationalise the railways, water, power and the Royal Mail. Where do you think the money is going to come from? Further if they don't get the hoped for extra tax receipts where will the money come from to fund free university education etc?

Interest rates are low all around the world, even in the EU. If you believe that the majority people are only in debt just so they can eat then how do you explain booming car sales, busy airports and packed bars and restaurants?

You're quite right, the Tory manifesto was c**p and they will continue with austerity only perhaps more subtly after the flack they've received recently.

[Debra]

[quote user="Chancer"]I agree with everything but your memory of credit card interest being a liitle over bank rate, whilst I have not borrowed on a credit card for décades I'm pretty sure it was always at least 2% per month, 24+% APR[/quote]I've always had a credit card with HSBC and as I remember it, it used to track the base rate at a couple of per cent higher than my mortgage rate did.  If you had one at 24% I don't know who it was with but that was high but what was the base rate at that time?  There is no justification in my view for a bank to charge 19.75% above the base rate for credit.

[Debra]

Trying to find a historical rates chart for the UK that I've found before when I checked my own memory of this and can't find it yet but I've found quite a few for the US and apparently the same thing has happened there.  The rates used to track their base rate but now banks are holding onto more of the spread to keep their profits up.

[Debra]

A report from last year says '

Average credit card interest rates hit all-time high of 21.6% APR - but the worst offender charges almost three times more

Read more: http://www.thisismoney.co.uk/money/cardsloans/article-3469629/Average-credit-card-rates-hit-time-high-21-6-APR-worst-offender-charges-three-times-more.html#ixzz4ixzpY4kC

When the base rate .25%?

[mint]

The hapless Fallon (dreary as they come defence secretary) said there would be no tax rises but then May had to come straight out to say they would keep taxes "as low as possible" as is written in their manisfesto.

Then she sent Hammond out to say there would be no increases in income tax, NI or VAT.  So, Drayton Boy, you are right about continuing austerity.

If tax revenues are going to be down, what will be hit the hardest?  That's right, no prizes for wondering where the money is going to come from for our public services.  Of course, she has many areas she can hit, the NHS, the  police, the military, the border agency, the environmental agency,  social care, schools, welfare recipients, the disabled, pensioners, young children, etc  In fact, she's already started on all of the above.  Well, as long as she and her ilk can continue to feather their own nests and she can blame everything on Jeremy Corbyn and those nasty Europeans, what does she have to fear?

[Debra]

Store cards charging 30%???

The only store card I ever had was an M&S one, because they didn't accept other credit cards at the time, and I'm pretty sure there wasn't much difference between what they charged and what HSBC did.

[EuroTrash]

I remember buying clothes in the UK, I think it was Next or somewhere like that, and when I went to pay the assistant asked if I had a store credit card and I said No, and she said that if I applied for one there and then I would get a discount on my purchase, 10% or something. I said did I have to spend a minimum amount on the card and she said No, you just have to apply for it. So I did, can't remember if it ever arrived or not. But I thought at the time that they must be confident of raking in cash on these store cards if they think it's worth their while to bribe people to apply for them. This wasn't very recently, maybe a few years ago, so I don't know if they still do this.

[DraytonBoy]

If your party's mantra is 'the low tax party' you are kind of screwed when the time comes to pump money into public services or watch them crumble. However they could have got away with it this time as all the other parties have proposed to raise taxes but they have arrogantly chosen the austerity route again.

[Grecian]

Sadly mint you are spot on with your assessment, whilst you mentioned pensioners don't forget raising the retirement age, that's a nice little earner some 13 billion pounds I think they save for each year that they raise it, they be able to give to their rich mates plenty of tax cuts with that amount banked.

The sick and disabled have been hit hard by the totally heartless cuts to their benefits under the tories, and if they retain power then you can be certain that they will be back to take even more off them. From April this year people who have been diagnosed with cancer, have had a heart attack or stroke or any other nasty illness or condition you can think of have had £30 a week taken off them. The tories claimed that it will encourage them back to work quicker, for **** sake when you are battling cancer I can assure that work is the last thing on your mind.

Whilst I did not watch last nights debate, sorry Theresa dodging questions from the audience, I see some moron was attacking Corbyn for not wanting to wipe out the other half of the world by not pushing the button. I guess that he will not be worried about any of the above cuts we can look forward to that you listed, so long as Theresa pushes the button. For goodness sake.

So basically mint as you have stated its more cuts for the peasants and tax cuts for the likes of MacDonalds and Starbucks, very depressing indeed.

[andyh4]

Chancer wrote:

I agree with everything but your memory of credit card interest being a liitle over bank rate, whilst I have not borrowed on a credit card for décades I'm pretty sure it was always at least 2% per month, 24+% APR

Except that 2% per month is around 27% per year due to the compounding of the debt.

Compounding is badly understood by the population at large but it is the reason that you end up paying nearly twice what you borrowed on your mortgage over its full lifetime, even though the headline interest rate is only a few percent.

[NormanH]

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[Chancer]

I knew it was more Andy, my guess was around that figure but I could not be bothered to work it out or check so just used an approximate 24%.

 

I truly did think that was what credit card rates always were, my sister was in debt to them most of her life (storecards were also her downfall) and I probably only paid interest one time, one month (a missed payment) and never again, Debra seems quite sure and if the current 21% is a record high then my memory was wrong.

[Patf]

Friends were trying to payoff a big debt on their Barclay' credit card, interest rate about 25%.

They managed to get a loan from Credit Agricole and paid off the whole lot in one go. CA loan at a low fixed rate.

[DraytonBoy]

Several things on the tree Norman are estimates (tax avoidance and corporate tax loopholes for example) and will require legislation BEFORE any money comes into HMRC's coffers. VAT on private school fees could well put off parents sending kids to posh schools so expected revenue will fall and the kids will have to be found places at already overcrowded state schools. The biggest apple on the tree (corporation tax rises) will undoubtedly raise a lot of money in the short term however the risk is that companies will simply cutback on investment and jobs to maintain shareholder dividends.

Any thoughts on the renationalisation programme cost?

[EuroTrash]

Just seen the news.

Horrible, sickening, words aren't enough.