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Lenore Skenazy

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Consumer Reports

A big interest in you | While you're writing your holiday cards this year, don't forget to drop a note to your friendly credit card company. After all, it's always writing to you, right? Always offering you great introductory deals like 0% interest rates?

What could be friendlier than that? Nothing! Provided you don't read the fine print.

If you're too busy to tell these companies just how delighted you are to discover sudden surges in your late fees, interest rates and overdraft penalties - all bringing the credit companies $21 billion in fees - why not just use this handy form letter? The credit card industry will be as happy to hear from you as you are to hear from it.

Dear Bank:

Thank you so much for the credit card - and such reasonable terms! Why, it says here in really, really tiny letters that if I am late on a payment by, hmm, 60 minutes, you will only charge me a late fee of $39. That's far less than my local loanshark!

Well, actually, that's just about the same as my local loanshark. But at least you don't skulk around the pool hall. You're an upstanding American company.

I also appreciate the fact that though you have upped my annual interest rate from [insert attractive initial interest rate here] to [insert punitive new interest rate of more than 24% here], without warning, you had a very good reason for doing that.

And that very good reason was that I was late paying last month's cable bill.

That's right. Even though I was on time with every single payment due your company, you are penalizing me for being late paying a completely different company.

I see here - I'm getting out my magnifying glass - that you mentioned this in the fine print when I got your card. It's a practice called "universal default": treating a late payment to someone else - a mortgage or car payment, for instance - as if it were a late payment to you.

Now, how many people would even notice exactly when I paid my cable bill? See! You are extremely thoughtful.

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You were also using that noggin when you decided to incorporate in a state with no usury laws - that is, no laws against unconscionably high interest rates.

In 1976, the Supreme Court ruled that states should be able to set their own interest rate ceilings. So you settled in one of the few states that decided the sky's the limit.

This explains how you and your fellow credit card companies are charging interest rates that in at least one case hit 41%.

What more can I say? As one of the 60% of credit card customers carrying some debt on my card, I know that without you I would not have had the money to pay for all my Christmas presents last year. Of course, with you I don't have enough money to pay for any presents this year. All my float goes to pay my interest charges and late fees.

Luckily, by making minimum monthly payments at 18% on the $10,000 I foolishly racked up, I know I will be home free in a mere 56 years.

Till then, here's wishing you the very same delightful Christmas that you have given me.

I am forever in your debt.



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