Credit Karma ordered to pay users after falsely claiming they were pre-approved for credit cards
Let’s start with interest rate hikes and obviously the Fed is trying to fight inflation. They’re raising rates and *** a lot of the analysts I’ve watched said, you know what they’re going to raise all year, then in 2023 they’re going to start cutting rates, then all *** suddenly this week, they say. You know what, I think we’re going to hold rates, it feels like they’re going to keep rates high through 2023 and now that the market is crashing, rates are going up. You know, what does that mean for my credit card bill? It was *** little jarring this week, wasn’t it. It’s this idea of, okay, I think people are comfortable until the end of the year to cut spending. We are, we all understand that the real estate market can come back a bit as mortgage rates go up and we’re all pretty comfortable with our credit card interest rates not going up not really *** a bit but you’re right that’s why the market has been shaken up this week because there’s this feeling now that it’s going to go a bit deeper in 20 23 and that could mean that this recession that we’re probably in right now could go into the third or fourth quarter of 2023. And so I think the Fed’s decision is extremely cautious to make sure that doesn’t happen if I have a debt of credit card right now, what so many people are doing, what should I do? Should I focus all my money on reimbursement? And is there another part of my life that maybe I should spend less. So I don’t have these rates that keep going up. People can’t get out from under that at any given time. People certainly shouldn’t be sitting on a savings surplus. So once you’ve saved *** some $1,000, if you’re able to do so, don’t sit on the extra cash to pay off your credit card debt. Because these rates are climbing so fast. You know when, when rates are down 3% or something, you might say it makes sense to hold a *** balance. I don’t like the argument, but I would listen to it when it hits 14%, which you talk about before you know it, your balance doubles. So, uh Jeff, I actually want people to feel like they felt in March, April, and May 2020 and use that feeling to fuel their behavior to make changes to that credit card debt right now. You need to withdraw the money from your savings if you have a stock of *** there and this is designed to pay it off to start paying credit card bills. Yeah, don’t wipe yourself, let yourself *** some $1000 be careful. But at the same time like it’s really if you’re sitting on four or 56 months of savings if you’re lucky enough to quit because you’re earning next to nothing on it and paying *** ton of credit card debt. Yeah. It’s a good question. How long should we have in the bank to save? I like three months. But I’m also saying that knowing how hard it is to do, but people got better in 2020. Like people actually start stacking it like kids might say in 2021, they’re unloading it. So we find ourselves in a weird *** space right now where I don’t know if people realize that we’re tightening up as much as we are. Is there a *** way to call the credit card companies or any debt we have and say you know I paid my bills on time. Is there bargaining allowed here Or is it like paint by numbers? It’s like that. Or can you say listen, I’ve been a *** good customer for 15 years. I need help now. Can you lower my, can you do that? You can try. I mean we’ve all tried to lower our cable bill from time to time. Like that I think. Yeah it works it works. Here’s what I would say, maybe it’s talk about *** balance transfer, call them and tell them, I’m considering transferring my balance to a *** lower interest rate card. I prefer not to do that. Are you willing to lower my *** rate a bit. Um, that’s *** a reasonable thing to do. And another thing, by the way, I don’t want to get too far off topic, but that’s good *** advice. These credit card companies have retention services and sometimes you can call and say, you know what? I’m tired of paying this price. Another credit card. I’m about to leave you and another credit card committee is going to give me a better rate. They will send you in many cases to our detention and they will refund you money. In some cases, they’ll just say, hey, here’s $300 for you to stay. And I would note this. Uh, you attract more bees with honey than with vinegar. So if you’re going to negotiate with these people, be nice. You don’t try to annoy them, be nice to them, you go a lot further with them. Like, hey, I like, I like being *** I like being *** customer. You’ve been great, but I have to go where the best rate is. What are you gonna do for me? Let’s talk about student loans. Where are you ? I mean you got Democrats shooting inside the tent? You know, you obviously have Republicans saying it’s inflationary. Where are you ? I think you can have very complex feelings about it, like I’m doing good, I, there’s good and there are unintended consequences to come. So there are two major issues, you know, this Jeff, the two issues are that college is very expensive. OK. And the second problem is that it created *** a lot of student debt. And so this is an attempt to address the second problem which is a lot of student loan debt. And in doing so, I think it’s going to make college more expensive. So I’m thrilled for the people why? Why? Why? Why? Yeah, there are *** a few different reasons why we already have registered college presidents. But saying anonymously that they now feel less pressure to cut tuition. Uh, the more accessible student loans are, the higher the price of a college education can go. And there are studies that show there’s a *** direct correlation there. Now there is a secret part of this executive order. This secret. That looks *** unsalacious. There is *** part that people don’t know about and that is that income based reimbursements can be capped at 5% of *** person’s income. Exactly. Here’s what that means is there will be *** moment in time based on your earnings. If you make an income-based repayment, there will be just that payment you make, regardless of how much student loan debt you have. If I come out of school with $60,000 in student loans or if I come out of school with $180,000 in student loans, it’s still that 5% payment. And so if, if that’s the case, *** a lot of people are just gonna go, well, I’m going to the best school, what does it really matter? I’m going to be stuck at that 5%. And that’s where this thing has an ugly half-life and could cost a lot of us who have kids who will hopefully go to college one day. Um, and it’s gonna cost, I mean, it’s already outrageous. I have, I mean, listen, I have concerns about that aspect of it. You know, there are a lot of upset people, be upset if you want. I’m not going to tell you about the ledge there, but I will say this if you’re a ***parent of a primary or secondary student right now, what happened last week is going to have an impact* ** more important to you than anyone arguing about what is right in terms of forgiveness. Eight million people will have their accounts automatically deleted and they won’t have to do anything. The rest of those who may qualify will need to show proof of income and they will need to complete *** a specific form. So, and there’s also the idea that it’s slightly possible that it will never go right, that there might be legal challenges to that. Clearly not *** legal expert. I’d have a nicer shirt if I was, but I’d say there’s a *** slight possibility that this isn’t all about the Fed fighting inflation. They have to shrink the economy. We hear about layoffs, big layoffs, big layoffs at *** a lot of companies. Um, there’s going to be pain here. There’s that, that’s why it’s hard to talk about, you know, even in that format, right? It’s that we’re trying to figure out what’s going on and to some extent that marginalizes people who go through the worst 30,000 feet by talking about this imaginary thing called the economy, not imaginary, but it’s not *** a real person, has no feelings, but there are people who will really lose their livelihood, who will go through intense and intense pain. And it’s hard to look at this thing that the economy is and put that above people’s emotions and people’s families. It’s incredibly difficult and, and that’s why *** a lot of the kind of political exchange we have today wants to make everything very binary. It’s either that or it’s that, it’s never that or that. It’s, it’s, it’s really complex because it’s people’s livelihood. Like you said, maybe he’s a *** college grad who just graduated in May 2022, started a *** job, got laid off, you know, three months later and now they have *** ton of student loan debt, well over $10,000. And so it’s going to be tough. And I, you know, I’m not a *** prediction guy, but I would be looking for it to get harder and harder in the second quarter or so of 2023, so you just need to prepare yourself mentally for more difficult times.
Credit Karma ordered to pay users after falsely claiming they were pre-approved for credit cards
Related video above: A financial expert talks about the impact of interest rates on your credit card debtSome Credit Karma users might see part of a $3 million payout. The Federal Trade Commission ordered the company to pay users after it falsely claimed they had been pre-approved for credit cards. between 2018 and 2021. Credit Karma says it disagrees with the FTC but manages to avoid disruption. It is not known how many consumers have been affected. or credit cards.
Related video above: A financial expert talks about the impact of interest rates on your credit card debt
Some Credit Karma users might see part of a $3 million payout.
The Federal Trade Commission ordered the company to pay users after it falsely claimed they were pre-approved for credit cards.
FTC officials say nearly a third of people who applied for these offers were turned down and the misrepresentations hurt their credit scores.
This happened between 2018 and 2021.
Credit Karma says it disagrees with the FTC but manages to avoid disruption.
It is not known how many consumers have been affected.
Credit Karma lets people monitor their credit information for free, but it gets paid when customers are approved for loans or credit cards.