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  #16  
Old 03-04-2013, 08:53 AM
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I can understand giving a 21 yr old a 700-800 dollar limit, but 10 yrs ago they were giving college freshman 5k limits. Debt is not good and as an individual, there is no such thing as good debt.
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Old 03-04-2013, 10:56 AM
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There is the "rule of 72". You divide the number 72 by your interest rate and the resulting number shows how many years it will take for your balance to double. 24% is a common credit card rate so I will use it in this example. Say you see an item normally for $150 and it is on sale for $100. You don't have cash but it is such a good deal you use your credit card. If you pay the minimum balance each month, in 3 years you will owe approx $200 on that purchase. In six years, $400, and in 9 years (if you pay off your balance by then) you would have paid approximately $800 for that great deal. So it goes to show -- never buy on credit what you can't immediately pay off -- or better yet, don't use credit cards at all.
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Old 03-04-2013, 07:37 PM
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Originally Posted by Ajax View Post
or better yet, don't use credit cards at all.



The only time I use my credit card are the few times I when I need to buy something via the internet and then it is paid off at the end of the month. I’m the kind of credit card user that credit card companies hate.


The best credit terms you can get; "100% down and no more to pay."
If you cannot afford those terms then you really cannot afford the item.

The only reason to give credit cards to students is to teach them that it is perfectly normal to be in debit up their eyeballs.
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Old 03-05-2013, 12:33 PM
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I’m the kind of credit card user that credit card companies hate.


They make their cut on the transaction and have no worry of default. They love us, trust me.
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Old 03-05-2013, 12:41 PM
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Some interesting videos on credit cards and loans etc

http://www.youtube.com/watch?v=yXKk4fFGl88

http://www.youtube.com/watch?v=22K-EUnF9bM

We are all playing Monopoly for real!

But, its all an illusion!
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Old 03-05-2013, 05:22 PM
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Originally Posted by Mad Scientest View Post



The only time I use my credit card are the few times I when I need to buy something via the internet and then it is paid off at the end of the month. I’m the kind of credit card user that credit card companies hate.


The best credit terms you can get; "100% down and no more to pay."
If you cannot afford those terms then you really cannot afford the item.

The only reason to give credit cards to students is to teach them that it is perfectly normal to be in debit up their eyeballs.
I agree, but limit the debt to 1k and let them see how hard it is to pay off.
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Old 03-21-2013, 08:17 PM
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They give you the highest limit they think you can possibly handle and if you keep paying the balance in time, they will keep raising the limit. The idea is to turn you into a money machine for the credit card companies so you actually work for them. Once I got off credit cards and used only my debit card, I saw my savings steadily rise and rise and rise! I have an investment portfolio now which I would never have had if I had credit cards.
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Old 03-22-2013, 06:32 AM
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It was at one time, IMPOSSIBLE to travel w/o one. Each and every reservation must be " held " with a credit card. So, I never
traveled. Now, it's for different reasons: molestation in airports, can bring my knife but not my shampoo, etc.

Once they snare, they have this cute little trick of upping the interests. Makes it virtually IMPOSSIBLE to pay off ever.

Evil parasites. A necessary evil tho?

ETA: I can recall one very young family member desiring a trip to the Girls Gone Bad area of Mexico with her college friends for the infamous Spring Break. She signed the app (she was NOT in college) and kept using it there after - going beyond her "limit" and needing to borrow from her very upset mother. It was bad times for her for awhile in that household. The poor kid practically drank herself to death.

Last edited by happy2bhere; 03-22-2013 at 06:37 AM. Reason: ugh
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  #24  
Old 03-23-2013, 03:37 PM
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Every time you use a credit card you are in effect taking out a loan which of course the banks love to see because all this “money” is just imaginary numbers entered into their computers. Consider how this works.

If you came to me and said can I borrow $20? Well OK I can do that, I open my wallet and hand you $20. Now seeing as how I had to actually to “work” to produce that $20 naturally I will expect to be paid back in a reason amount of time as I have given you something of real value.

But what if I am a banker and you want to borrow $200,000 for say a new home? So you come into my bank and say “give me da money” well OK that might not be the best way to start off the loan process, but in any case we are talking about theft here. So we sit down and I show you all of the marvelous plans that I have to offer, and you chose one that you are comfortable with. Then after all is said and done you sign the loan contract.

So now what happens do I get up open the vault and grab a bunch of money and hand it to you? Not quite, there is no way I would touch the banks money instead I turn on my computer and by noting that you have promised to pay the bank $200.000 plus interest I write you a check for the $200,000. What is going on here where did that money come from?

By signing the loan contract you have effectively created the $200.000 (plus interest) that you will produce through your future labors which you have just signed over to the bank. Based on that I will write you a check for $200.000 on the “good faith” of my bank or more simply just out of thin air. The reality is I gave you nothing but you gave me something of value, your labor. You then give that check to the person you’re buying the home from and that person could then turn around and deposit that check back into my bank. At which time I will treat it as real money not something I just created out of thin air. But now because it is considered real money I can lend out 10 times that amount, in some cases even more, this is called fractional banking. Gee isn’t this fun being a banker? I can create money out of thin air and you have to pay it back through your hard work and labor.

What you say you think this deal doesn’t sound fair? Will just wait as your friendly banker I’m just getting started. You see I don’t really want to be bothered with your loan and all the other loans I have made. So I bundle them all up and sell them as a package to another larger bank or some other entity. You undoubtedly will not be made aware of this transaction. However the people that buy the loans know that some of the people that took out these loans will not be able to pay them back, thus they buy insurance to cover these loses. This insurance will cover their losses usually by a factor of ten. As such these people are more then willing to see these loans go into foreclosure, in fact they encourage it because they can make a ton of money. Being a banker is fun you get to make tons of money and you don’t have to produce anything.

There is one small fly in the ointment here. One that you are absolutely not supposed to be aware of. What happened when the bank sold your loan? As far as the bank is concerned your loan is now paid off and no longer exists thus you no longer you owe them anything. However did you sign a new contract with the people that bought it; did you even know it was sold? If you did not sign a new contract with them then you owe them nothing, well maybe a thank you for paying off your loan for you. So if a loan was sold and paid off and if you did not sign a new contract with the new owners why are you still making payments?
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  #25  
Old 03-24-2013, 08:06 AM
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Really? It could have worked? Our loan was sold to GM when we owed maybe five years on a 15 fixed.

Never signed anything with GM. They were some type of handling office located somewhere in Texas.

Legal? I could have just said, "sorry, I don't owe you anything for I never signed a contract with you." ?? Damnit.
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