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We may be in for a bit of turmoil. The  credit card  issuers who for years, did pretty much whatever they wanted without moderation are not too excited about the new upcoming changes. They have warned, that if the bills go through, we will all regret it. We have about nine months before these laws take hold, so until then it’s the wild west.

The benchmark prime rate which all others are based upon has fallen.  The last year has seen a record drop of 2% to 3.25%. So one would naturally assume that credit card rates have also fallen.  Wrong. Over the last year, the rate for credit cards has went up almost 1%. Now that the credit companies and banks are soon to get squeezed by Obamas new laws,  expect them rates to go even higher.  The big banks are under a lot of pressure to make a profit and stay afloat themselves,  so they are not going to be cutting consumers any slack.

Banking and Credit card  fees

The big banks and credit card issuers make a ton of money from fees. Late fees, balance transfer fees, foreign transaction fees, cash advance and ATM fees, yearly fees, and of course the “just because we feel like it fees. Watch your billing statements carefully. Compare them with credit card statements from past months and years. You will likely see some new and/or increased fees added. As the credit crunch and recession continue, the big banks make more and more money from adding on fees. So be alert, and read the fine print. A few of my cards seem to be changing the terms almost daily and I don’t think this is a rare occurance.

Rewards are dwindeling

You favorite cashback reward,  or airline miles card may soon be giving you the finger. The intense competition we have seen in past years for customers seems to have dissipated and the banks all decided in tandem to tighten the screws. The days of receiving a ton of zero percent interest rate offers in your mailbox are also going by the wayside.  Once again check the fine print. Read your constantly updated terms and be informed or you may be in for a nasty surprise when you find out that you no longer receive as many miles or rewards as you previously did. The whole industry is in turmoil after the big bank bailouts and there are likely more changes to come as banks figure out ways to recover from staggering losses and upcoming credit reform laws.

The best plan of action is education and comparison. Compare as many different plans and offers as you can find and don’t be shy to drop one and pick up another. The phone is also your friend, use it. Don’t be shy about calling up your lenders and asking about fees and interest rates on your account. They will still often drop or reduce fees or interest rate hikes. They make a huge amount of money because of the average consumers complacency and laziness or fear of dealing with such matters.  When they try to pull a shady maneuver, call them on it.  The worst thing you can do is sit idly by and watch your hard earned money go towards another huge bonus for the bank CEO’s and executive staff.