Quote:
Originally Posted by jewels
The banks aren't at fault because they simply responded to demand.
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I think the banks own some responsibility. They were loaning money to literally anyone and everyone. I know, I know the damn Clinton Admin. forced banks to give home loans people who didn't really qualify. I haven't looked into that claim that much, not sure I buy it. What I do know is credit cards were being handed out like social security cards. If you we're breathing you could probably get one. Hell, I had 10-15 offers showing up in my mail each week. And seriously who hasn't seen a news story where the family dog was issued a Master Card?
Not only did the banks issue cards to just about anyone they made credit limits on those cards way beyond what I would consider responsible. I had three cards at one time with credits limits that would have allowed me to purchase a house on them if I wanted. I did in fact use one to buy my daughter a new Toyota on one once. I paid the bill off when it came but it was nice to get the air miles. I was watching Suzy Orman the other night and one of her call in questions came from a lady who said she had over 100K on her credit cards. She was having trouble making the min. payment (really, no shit?) and wanted to know what to do. Suzy basically told her to file bankruptcy, something I rarely hear her advise.
Basically unless your name is Bill Gates you should a credit card with a limit of about 10% your annual income and you should keep little to no balance. Use it and pay it off each month. If an emergency arises and you need a new washer, dry, stove etc... use it. If you can't pay it off right away do so as soon as you can. Pay it off over 6-12 months, but pay it off asap.