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altyfc
Joined: 29 Dec 2004
Posts: 1232
Location: Aardvarkland
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 Posted: Thu Mar 29, 2007 9:54 am Post subject: Minimum repayments |
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Minimum repayments are designed to make your debt linger, thus allowing the banks to make more money of their customers. Is this iiresponsible of the banks, or just good business on their part? Should they be doing more to help individuals pay their debts, or is that the responsibility of the borrower and nobody else?
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iFinancialAdviser
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Joined: 28 Dec 2004
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| Posted: Thu Mar 29, 2007 10:15 am Post subject: |
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I have to think for a while to answer this question, but here's my general take on banks. They have too much power; also the state/the government gives them too much power. This is not very healthy for our economy as a whole.
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altyfc
Joined: 29 Dec 2004
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iFinancialAdviser
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| Posted: Fri Apr 06, 2007 3:05 am Post subject: |
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| altyfc wrote: |
| In what way do you think they have too much power? |
Oh, here's an example. Fractional lending. Bank can lend up to 1000% of its reserve in US. For example, if a bank has 10 million dollars in its reserve, this bank can lend 100 million dollars. If a normal person does this, this is called "fraud". The government allows this and the government even insures money saved in the bank in case that the bank screws up.
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capebretoner
Joined: 02 Aug 2006
Posts: 82
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| Posted: Fri Apr 06, 2007 6:16 pm Post subject: |
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| iFinancialAdviser wrote: |
| altyfc wrote: |
| In what way do you think they have too much power? |
Oh, here's an example. Fractional lending. Bank can lend up to 1000% of its reserve in US. For example, if a bank has 10 million dollars in its reserve, this bank can lend 100 million dollars. If a normal person does this, this is called "fraud". The government allows this and the government even insures money saved in the bank in case that the bank screws up. |
I can see that but I don't see what it has to do with minimum payments?
I think that the general public has to learn some better simple math. A CC is not a bank account, it is a tool that allows easy payments for everyday purchases. You should be able to pay off your CC at the end of EVERY month. You should not run a deficit.
The minimum payments however are needed for those un-foreseen circumstances, like your transmission drops out of your car and you can't pay off you CC that month. |
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altyfc
Joined: 29 Dec 2004
Posts: 1232
Location: Aardvarkland
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| Posted: Thu Apr 12, 2007 3:35 pm Post subject: |
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| capebretoner wrote: |
| The minimum payments however are needed for those un-foreseen circumstances, like your transmission drops out of your car and you can't pay off you CC that month. |
I beg to differ. To my mind, that's what savings are for. 
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iFinancialAdviser
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| Posted: Wed Apr 18, 2007 8:19 am Post subject: |
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| capebretoner wrote: |
| iFinancialAdviser wrote: |
| altyfc wrote: |
| In what way do you think they have too much power? |
Oh, here's an example. Fractional lending. Bank can lend up to 1000% of its reserve in US. For example, if a bank has 10 million dollars in its reserve, this bank can lend 100 million dollars. If a normal person does this, this is called "fraud". The government allows this and the government even insures money saved in the bank in case that the bank screws up. |
I can see that but I don't see what it has to do with minimum payments?
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Well, there is a indirect correlation, but there is really no direct correlation. I was just answering to the question "In what way do you think they have too much power?".
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Money-Helper
Joined: 02 Aug 2007
Posts: 76
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| Posted: Wed Aug 08, 2007 3:48 pm Post subject: |
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| Minimum payments are of course designed to keep you paying your cards off for as long as possible - in some cases actually never paying off the debt. That doesn't make it wrong - just stupid. |
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