Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Credit card debt collection

bitsaboutmoney.com

Post reply on HN
Print view View original

181–190 of 568 posts

Re: Credit card debt collection

#181

Post by mrweasel »

adev_ wrote: post #151
unmole wrote: post #125

Earlier quoted context omitted.

> It might be a very European view to the problem but: Why does the American government does even tolerate this credit card garbage business in the first place ? TIL: Credit cards are banned in Europe. /s

> TIL: Credit cards are banned in Europe. /s They are not banned. They are heavily regulated in many European countries. In several of them: - Cashback systems are simply banned. - Credit card are by default Debit Card. The credit option need to be opt-in. - Credit Card payments spread over several months are discouraged or simply banned by default. Credit cards are also much more rare. With an average of ~1 Credit C…

> Credit card are by default Debit Card

Credit cards are credit cards, even in Europe. It's just that banks issue debit cards, rather than credit cards and I think that the point. You're financial business in much of the EU is between you and your bank, not some third party credit card company. The debit cards rides on top of the networks built by VISA and MasterCard (and others) for the credit card industry, but the actual financials are between you and your bank. The bank doesn't want you to owe the credit card companies money, they want you to owe them money, but that's normally done using a loan or allow overdraft of your account.

I really think the difference is in the banks and their involvement. Now I'm not suggestions that EU banks are awesome and cuddly entities, but they are more regulated and easily replaceable within many EU country. E.g. switching banks is really not a problem it takes a few days and you don't have to do anything.

Re: Credit card debt collection

#182

Post by Reason077 »

adev_ wrote: post #151
unmole wrote: post #125

Earlier quoted context omitted.

> It might be a very European view to the problem but: Why does the American government does even tolerate this credit card garbage business in the first place ? TIL: Credit cards are banned in Europe. /s

> TIL: Credit cards are banned in Europe. /s They are not banned. They are heavily regulated in many European countries. In several of them: - Cashback systems are simply banned. - Credit card are by default Debit Card. The credit option need to be opt-in. - Credit Card payments spread over several months are discouraged or simply banned by default. Credit cards are also much more rare. With an average of ~1 Credit C…

Credit card use varies substantially amongst European countries. In countries such as Norway, Switzerland, Finland, and the UK, more than 60% of the adult population has a credit card. And it's more than 55% in Germany, Austria, Spain, and Italy[1]

Cash-back credit cards are rare in the UK and Europe not because of bans, but simply because of the interchange fee caps which don't leave enough margin for card companies to offer them.

> "Credit Card payments spread over several months are discouraged or simply banned"

Really? What country "bans" this?

[1] https://www.theglobaleconomy.com/rankings/people_with_credit...

Re: Credit card debt collection

#183

Post by lmm »

kioleanu wrote: post #141
turdprincess wrote: post #109

Earlier quoted context omitted.

On the other side, if you are privileged enough to be financially stable, in the USA it’s best to pay for every single thing with a credit card. Aside from the points and rewards, credit cards are much more likely to reverse fraud transactions. I’ve had banks deny fraud reports and demand police reports while credit cards always reverse the transaction no questions asked. Actually it’s best to not even have a debit c…

That is just another symptom of the problem I would say. Although it does happen, there are other mechanisms in place to protect you from fraud, which discourage fraud in the first place. I’ve been paying with debit cards for more than 15 years in Europe, tens of thousands of transactions and not once did I need to reverse one.

Lucky you. I have and it was an absolute nightmare, had to survive on no money for a couple of weeks until the reversal went through. Never again.

Re: Credit card debt collection

#184

Post by lmm »

adev_ wrote: post #135
benjaminwootton wrote: post #116

Earlier quoted context omitted.

Because the vast majority of people use credit cards without messing up their lives? I suspect most people don’t even need them but use them for cash back and consumer protection. For people who do need them, there’s nothing inherently wrong with buying something and spreading the cost or paying for it later in return for paying some interest. Most people who do that won’t get into any trouble. There are a hundred le…

> I suspect most people don’t even need them but use them for cash back and consumer protection. Then make a debit card system with cash back and customer protection. And kill a system that screw people with useless debts when there is no need for it. Btw > Because the vast majority of people use credit cards without messing up their lives? You never know where life bring you. I can certify you that "good", "honest",…

> Then make a debit card system with cash back and customer protection. And kill a system that screw people with useless debts when there is no need for it.

The debt is inherent to making the consumer protection work: the card issuer doesn't and can't take your money, they can only create a debt and ask you to repay it, and if you didn't get what you paid for you can dispute the billing before a penny leaves your account.

Re: Credit card debt collection

#185

Post by RobinL »

Reason077 wrote: post #177

One thing that's not mentioned in this article is that credit card companies will sometimes make last-ditch "clear your debt at a discount" offers before passing your debt on to a collection agency. This happened to me many years ago. In the wake of the '08 financial crisis, I'd lost my job abruptly and decided to go travelling. I'd accumulated a balance that was fairly substantial for me at the time (on the order of…

I suppose the problem is that if that becomes too prevalent, people will stop paying their bill in the hope that the credit card company will give them a discount

Re: Credit card debt collection

#186

Post by bettercallsalad »

nologic01 wrote: post #159

It is in this domain, of broken promises and broken people that you can establish what a society is really made of. Graeber's Debt is obligatory reading (alas not easy to read) if you want to dig into the painful history of debt relations between humans. The post provides excellent insights into the odious side of consumer finance. It feels like a follow up with ideas about reform would not be wasted effort: Once thi…

I am far from religious, but one thing most religious traditions have common is how they ban usury/interest which would make much of global finance we have today “haram”.

You can see the reverse effect too not only at an individual but collective level. Once the religious ethos disappears from a sect, widespread adoption of debt becomes the norm.

Re: Credit card debt collection

#187

Post by b112 »

RobinL wrote: post #185
Reason077 wrote: post #177

One thing that's not mentioned in this article is that credit card companies will sometimes make last-ditch "clear your debt at a discount" offers before passing your debt on to a collection agency. This happened to me many years ago. In the wake of the '08 financial crisis, I'd lost my job abruptly and decided to go travelling. I'd accumulated a balance that was fairly substantial for me at the time (on the order of…

I suppose the problem is that if that becomes too prevalent, people will stop paying their bill in the hope that the credit card company will give them a discount

Poor credit can cost you dearly. Higher rates on everything, and a .5% difference in a mortgate rate is massive.

It's a way to burn your credit for years, at great personal cost, so not likely that people will take the out without desperation.

Re: Credit card debt collection

#188

Post by eru »

whatshisface wrote: post #152
eru wrote: post #101

Earlier quoted context omitted.

> That’s important to keep in mind when you’re thinking about welfare bureaucracy or voter ID laws or anything like that. Amen to that. Though luckily while it's huge problem for the former, it doesn't matter for the latter. (Because individuals by and large don't benefit from being able to vote. Voting is at best something altruistic, individuals do out of civic duty.)

You will be in for a surprise to find out what happens when only the people from a restricted demographic are able to, altruistically, vote. :-)

Not sure. What big changes happened thanks to eg women getting the vote?

In the US, it was mostly Prohibition I guess?

Re: Credit card debt collection

#189

Post by worldwidelies »

Reason077 wrote: post #177

One thing that's not mentioned in this article is that credit card companies will sometimes make last-ditch "clear your debt at a discount" offers before passing your debt on to a collection agency. This happened to me many years ago. In the wake of the '08 financial crisis, I'd lost my job abruptly and decided to go travelling. I'd accumulated a balance that was fairly substantial for me at the time (on the order of…

same experience, except it wasn't that simple. A family member told me I should settle with them, because that's what they did too. They wiped the balance and closed the account but the settlement stayed on my credit score for 7 years. I had a friend who was getting calls by a debt servicer and was making it seem like no big deal. I told my friend to ask the person about the 7 years, the person reluctantly admitted that his credit score will be flagged for 7 years.

Re: Credit card debt collection

#190

Post by eru »

Reason077 wrote: post #179
acyou wrote: post #97

Earlier quoted context omitted.

Singapore has many systems, rules and laws that would not and could not work elsewhere. It's great that it works for them, but it doesn't work in the USA, or most other countries. I will point out that they are an affluent, monocultural, somewhat xenophobic, authoritarian and borderline fascist city-state.

Singapore may be many of those things but it's not "monocultural". Besides the fact that it has 4 official languages, foreigners make up about 30% of the resident population - a much higher portion than the USA, for example!

> [...] foreigners make up about 30% of the resident population - a much higher portion than the USA, for example!

I mostly disagree with acyou's comment, but since Singapore is a city as much as a state, the more enlightening comparison might be with how many of eg New York City's residents were born out of town? (Or perhaps how many of NYC's residents were born out of the country? It's murky, and there might not be one best comparison.)

In any case, I agree that Singapore is not 'monocultural'.

Post reply on HN