Banking swindles

[Rubberman]

I heard of another one yesterday.

We all think we know the difference between credit card debt (unsecured) and a mortgage (secured on your home). In the UK, any secured loan has to be advertised with the words "Warning! Your home may be at risk if you cannot keep up payments."

But what most people don't know is that any unsecured loan can be turned into a secured one behind your back. If the bank thinks that you will not be able to repay, they can apply to the courts for a "charge" to be placed on your home. You will not be told about this until after it has happened. You can then "make representations to the court" (i.e. try to persuade them that there is some good reason in law why they should not do this). If you fail, and you still can't pay, your home can be sold over your head.

What is so iniquitous about this is that most people would not run up such debts in the first place if they were warned that they might be putting their homes at risk.

Step one - kill all the lawyers. This will deal with 98% of all the politicians.
Step two - kill all the bankers. This will deal with 98% of the rest.
Step three - fire all the police. This will result in a much less violent society.

[roland985]

Step four, destroy Microsoft. That will result in the world surviving 2012 intact...

[cousinlucky]

The safe thing to do is to run your life so that you do not have to borrow money or use credit cards!!

[Rubberman]

The safe thing to do is to run your life so that you do not have to borrow money or use credit cards!!

Easier said than done! I try to keep such exposure to a minimum, but...

1. Mortgage - I only owe about 1/3 the value of the house.
2. Travel - pretty much impossible to purchase a plane ticket or rent a car without a CC. I use AMEX for this - pay off monthly.
3. Online purchases - need CC or Paypal account for this. I REALLY don't like PP.

Anyway, credit/debit cards and some sort of borrowing is a fact of our lives. At least you can use a debit card in place of a credit card for most things, and you can use them to get cash from an ATM all over the globe!

[hazel]

Anyway, credit/debit cards and some sort of borrowing is a fact of our lives. At least you can use a debit card in place of a credit card for most things, and you can use them to get cash from an ATM all over the globe!

You don't need a credit card for online - you can use a debit card on most sites. Of course it's then your responsibility to see to it that you don't get overdrawn.

I have never been in debt. I was brought up with a horror of debt, as were most of my generation. My mother bought our first house with my father's life insurance, and we bought my current house jointly with the proceeds of the first plus all the money I had saved from work.

Actually I have suffered for my principles! I don't have a credit record so I have great difficulty in proving my identity.

[Roxoff]

You don't need a credit card for online - you can use a debit card on most sites. Of course it's then your responsibility to see to it that you don't get overdrawn.

No, never do this. There are unscrupulous people on-line and things go wrong. Even if you always pay your credit card off at the end of each month, you should have one just for internet purchases.

If the items you buy are faulty and the company you buy off disappear overnight, which can happen more easily on the internet, then the credit card company are as liable for the goods as the original retailer.

Also, if someone grabs your number and steals money from your account, you're not personally liable for losses (unless you handed over the pin/security codes freely, of course) the risk here falls to the credit card company. If you use your debit card, you're personally liable for every last penny.

This all applies to credit and debit cards issued here in the UK, of course. I've no idea what applies for other countries, although I suspect the EU nations will be very similar. I would never use my debit card online, the risks of being defrauded may be small, but the effects can be horrible.

[cousinlucky]

I won't touch any credit cards!! Years ago when i switched to Commerce Bank the woman at the desk explained to me all of the things that they had for people over 50. At that time all 50 plus checking accounts were absolutely free and included a debit card that I was eventually persuaded to get.

I had three checking accounts one for everything on line; one for household bills and one everyday use. Replacing the debit cards was free and easy and your bank account numbers are not on the debit cards.

Over here people that do not go over their bank statements or keep a close eye on their balances are asking for trouble. A nationwide law was recently passed that prevents banks from charging fees and penalties if you go one penny over your balance.

The banks had been doing that automatically but now everyone must sign up for " overdraft protection " if they want it.

In today's world it is much better to be overly safe than extremely sorry about your personal finances!!