Des Moines Register - Obama Offers Plan for Averting Credit Trouble
Americans need a "credit card bill of rights," Democratic presidential candidate Barack Obama said Monday.
"Many credit card companies today are tricking Americans into agreements they can't afford because that's how they make big profits," Obama said during a campaign stop at Grand View College in Des Moines. "No company's bottom line should come before what's right for the American people."
The U.S. senator from Illinois noted recent reports that show the average American family has more than $8,000 in personal debt.
He outlined a plan that would prevent credit card companies from raising interest rates without giving consumers the chance to opt out of the agreement.
Obama's plan would ban rate increases on past debt. It would also prevent credit card companies from charging interest on transaction fees.
Four central Iowa residents took part in his round-table discussion about credit card debt. Des Moines resident Toni Jones outlined the problems she continues to face after someone stole her wallet and her identity about six years ago.
Jones said she has had trouble getting loans even though she said she has never had a late credit card payment. She estimated that she has written 100 letters to credit bureaus in attempts to clear her name.
"It ruined my credit and my ability to get loans, and my credit was next to perfect when this happened."
Other presidential candidates have also proposed ideas to help resolve problems Americans face with bad credit. Most recently, Democrat Chris Dodd, a U.S. senator from Connecticut, said he would introduce a proposal that would make it possible to erase medical debt and student loans upon filing for bankruptcy. He criticized bankruptcy changes passed in 2005, arguing that they benefit banks and credit card companies at the expense of citizens.
"The credit card industry and the major banks of the country wanted it," Dodd said. "And on the other side, we were aligned with every consumer group and every advocate group."