Study reveals consumers paying credit cards over mortgages. What this really means.

As soon as TransUnion released its research, news headlines announcing the results multiplied like foreclosures in Detroit. The first headline I saw read: “Consumers Paying Credit Card Over Mortgage”.  I was attracted to the story not because it was shocking, but because it confirmed what I already knew would happen.  Let me explain.  Imagine the following predicament:

The numbers don’t lie: a side-by-side comparison of credit unions and banks

Simply put, credit unions are better than banks—assuming that you want to keep more of your money.  You’ve heard me say it, but I haven’t provided comprehensive, empirical data that proves it until now. 

This morning, I received a press release by the Georgia Credit Union Affiliates that highlights the major differences between credit unions and banks as reported in a recent comparison index.  For example, in Georgia, the average interest rate for credit cards in 2008 was 11.53 percent for credit unions, compared to 12.41 for banking institutions. Furthermore, a Georgia credit union member who finances a new $25,000 car through a 60-month loan will likely save almost $400 in interest the first years as compared to a bank. 

If you are a die-hard numbers person, read the cogent excerpts from the report below, proving that credit unions in Georgia are better options for consumers: 

Beware: These mortgage companies can hurt your credit

Since the launch of this web site just three weeks ago, I have received thousands of messages detailing your credit challenges.  From rising interest rates to credit card limit reductions–I have seen it all.  This valuable information has provided my team and me with a good sample to determine helpful theories.  The NewCreditRules.com team takes the data you provide to us and uses statistics to find patterns, strong correlations, etc. that will help you better manage your credit. 

Federal Reserve Bank study proves credit card redlining

While online recently, I came across a compelling blog created by a group of attorneys.  One of the lawyers who commented on my situation with American Express provided a compelling argument against the discriminatory practice of assessing one’s credit worthiness based on where he or she shops or lives.  The lawyer provided a link to a cogent study completed in February 2008 by a brilliant economist and Harvard alumnus who works for the Federal Reserve Bank of Boston.  Researcher Ethan Cohen-Cole provides a thorough mathematical analysis that translates into strong evidence proving the practice of credit card redlining.   In short, he concludes that credit card redlining is alive and well.  Cohen-Cole’s e-mail is in the report. Feel free to contact him. I did, and he was eager to help.  

You can read the study online at the Federal Reserve’s web site.