The Washington Post says banks have grown more sympathetic to stressed-out consumers and are now more lenient when it comes down to renegotiating interest rates and minimum payments. Banks aren’t out there advertising their willingness to bend, but they’re more willing to listen, the story says.
The move isn’t due to compassion, but rather fear of getting bilked out of money. If you’re able to negotiate a sweeter deal with your credit card bank, thank the kind folks who decided not to pay their bills.
From the story:
“Issuers are looking to get something as opposed to nothing,” said David Robertson, publisher of the Nilson Report, which monitors the industry.
Most card issuers are unwilling to talk about the practice for fear that they will be swamped with requests from people who do have the funds to pay their bills. But industry executives confirmed that the practice is becoming more common as card issuers face a record percentage of charge-offs, giving up on collecting debts that consumers never repay. The charge-off rate on U.S. cards for July was 10.52 percent of balances, according to Moody’s, which expects it to reach at least 12 percent in the middle of next year.
This is one instance in which the proverbial ants have the grasshoppers to thank for buying stuff they can’t afford.
Banks Ease Burden Of Credit Card Debt [Washington Post]