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Credit Card Companies Raising Rates

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					September 21, 2006




Public Recognizes Debt as a Fast
Growing Problem in U.S.
National Council of Higher Education Loan Programs
Fall Legislative Conference
Debt and Higher Education
Survey Specifications

   This presentation represents the views of 1,000 adults, ages 18 and over.

   The survey was conducted between April 13 and 20, 2006 and carries a
    margin of error of +/- 3.1 percent.




                                                            Page 2 |   Greenberg Quinlan Rosner
                                                                       Public Opinion Strategies
The public recognizes the seriousness of the debt problem
 How would you describe the issue of household debt on things like credit cards, car loans, home mortgages and
 payday loans in this country – a very serious problem, a somewhat serious problem, not too serious a problem,
 or not a problem at all?

100
                                                             Very serious problem            Somewhat serious problem
                               82                            Not a problem at all            Not too serious problem
 80



 60



 40


                               47                                                     15
 20



  0                                                                                    5


                                                                                        Page 3 |   Greenberg Quinlan Rosner
                                                                                                   Public Opinion Strategies
The public believes the problem is getting worse
 Over the past five years, do you believe the number of Americans having trouble with household debt on things
like credit cards, car loans, pay-day loans and home mortgage loans has gone up, gone down or stayed about
the same?

100


 80                  86

 60


 40


 20

                                                            2
  0                                                                                                 9
                   Gone up                             Gone down                     Stayed about the same



                                                                                         Page 4 |       Greenberg Quinlan Rosner
                                                                                                        Public Opinion Strategies
Debt is a middle class problem
 Do you believe the problem of rising household debt in this country is primarily a problem for lower income
families or do you believe the problem of debt is also a problem for middle class families, say, those earning
around $50,000 a year?

100


 80
                                                                                          79
 60


 40


 20
                                19
  0
                          Lower income                                               Middle class



                                                                                            Page 5 |   Greenberg Quinlan Rosner
                                                                                                       Public Opinion Strategies
Public more worried about debt than terrorist attacks
For the following list, please tell me how worried you are that this might happen to you personally.

                                                                                                         Very       Total
                                                                                                       Worried    Worried
Not being able to have a secure retirement                                                                 30            56
Being the victim of identity theft                                                                         21            69
Not having enough money to pay all your bills                                                              19            48
Getting cancer                                                                                             18            50
Falling deep into debt because of medical expenses                                                         15            44
Having to take on a lot of debt to pay for college                                                         12            27
Being the victim of a violent crime, like rape or assault                                                  11            35
Losing your house in a natural disaster, like an earthquake, fire, tornado, or hurricane                   11            38
Being hurt or killed in a major terrorist attack, similar to September 11 th                               11            33
Falling deep into debt from paying high interest rates on your mortgage                                    10            24
Falling behind on your mortgage and losing your home                                                       10            23
Falling deep into debt from credit card payments                                                            9            23
Having to file for bankruptcy                                                                               8            16
                                                                                              Page 6 |    Greenberg Quinlan Rosner
                                                                                                          Public Opinion Strategies
Combining all the debt related challenges, including medical, education, and
credit card, a majority indicate some concern about some debt-related problem
For the following list, please tell me how worried you are that this might happen to you personally.


                                         Very worried        Somewhat worried
          80

                                                             62
          60




          40




          20
                                                              27

           0
                                            Falling into debt, combined
                                                                                             Page 7 |   Greenberg Quinlan Rosner
                                                                                                        Public Opinion Strategies
Debt concern most acute among young, single and minorities

                             Very worried   Somewhat worried
  100


           77        76          75         73         73         71               70
   80


   60


   40


   20      46         38        46                     45
                                             36                   36               33
    0
        Non-whites   18-29    African       Single    Single   Unmarried Young non-
                             Americans                women     parents   college


                                                               Page 8 |   Greenberg Quinlan Rosner
                                                                          Public Opinion Strategies
Medical debt in particular worries the public.
 For the following list, please tell me how worried you are that this might happen to you personally.

                                                                    Very worried                        Somewhat worried
                                                                    Not at all worried                  Not too worried
60
                                                                                           55
                                                             Net
                               44                            -11
40




20
                                                                                           30
                               15
 0
                         Falling into debt because of medical expenses
                                                                                             Page 9 |    Greenberg Quinlan Rosner
                                                                                                         Public Opinion Strategies
Concern about debt also reflects a notably high level of self-
reported indebtedness
About how much debt do you currently carry? This would include things like credit cards, car loans, student
loans, doctor and hospital bills, finance companies, home equity loans and educational loans.


30


                     26
20                                                         23
                                                                                                20


10




 0
               Under $5,000                         $5,000-$20,000                         Over $20,000



                                                                                         Page 10 |   Greenberg Quinlan Rosner
                                                                                                     Public Opinion Strategies
One third of the public reports growing debt
Generally speaking, has your level of debt gone up, gone down or stayed about the same over the last five
years?



40

                                                                                                 36
30
                      35

                                                           28
20



10



  0
                   Gone up                             Gone down                          Stayed the same



                                                                                          Page 11 |   Greenberg Quinlan Rosner
                                                                                                      Public Opinion Strategies
Reasons are both voluntary and involuntary

 Can you tell me why you think your debt has increased?

 Voluntary reasons for debt              Involuntary reasons for debt
 Car loans/new car                11     Cost of living increase/price increase               14
 College loans/payments           11     Low wages/stagnant salaries                          10
 Poor spending habits/budgeting    6     Unemployed                                            9
 House loan/New House/New move     5     Interest rates increase                               8
 Credit cards                      4     Energy                                                5
 Children in college               3     Childcare/Raising children/ growing family            5
 Remodel house                     2     Medical costs                                         5
 Total                            42     Loans/Mortgage general                                5
                                         Economy                                               5
                                         Gas prices                                            3
                                         Total                                                69




                                                                      Page 12 |   Greenberg Quinlan Rosner
                                                                                  Public Opinion Strategies
Individuals, of course, assume the most responsibility for the debt
problem
And what do you think is the most responsible for this problem: the economy, government, individual borrowers,
or lenders and lending institutions?


40


30           35


20                                 24                     23

10
                                                                                10
                                                                                                          5
 0
         Individual           The economy            Government             Lenders and                  All
         borrowers                                                       lending insitutions



                                                                                        Page 13 |   Greenberg Quinlan Rosner
                                                                                                    Public Opinion Strategies
Public very open to policy solutions to the debt problem, particularly solutions
that attempt to educate and empower borrowers to make better decisions
 Please tell me if you favor or oppose the following suggestions for addressing the household debt problem
                                                                                                      Strongly         Total
                                                                                                         Favor        Favor
 Providing more incentives for people to save money.                                                         77           93
 Creating stronger requirements that companies explain their charges in simple, uncomplicated
 language.
                                                                                                             76           92

 Cracking down on abusive practices by lending companies.                                                    74           87
 Lowering the cost of living with things like affordable health care, housing assistance and low-
 cost student loans.
                                                                                                             70           88

 Providing more education and counseling to consumers.                                                       69           92
 Passing rules that would prevent lending institutions from engaging in abusive practices that
 would put consumers in unaffordable debt.
                                                                                                             69           85
 Putting a cap or limit on the rate of interest credit card companies can charge, even if it means
 some people will not have access to credit cards.
                                                                                                             65           83
 Providing an easy to understand government rating system on financial products that tells
 people how fair a product is to consumers.
                                                                                                             62           86

 Banning credit card companies from raising your interest rates if you make all your payments
 on time, even if you miss payments on other debts you owe.
                                                                                                             61           77
 Increasing competition by giving incentives to reputable lending institutions to compete with
 pay-day lenders in low-income neighborhoods.
                                                                                                             41           67
                                                                                              Page 14 |   Greenberg Quinlan Rosner
                                                                                                          Public Opinion Strategies
Support for policy solutions cuts across partisan and educational lines
                                                                                                                               H.S. or      College
                                                                                        Democrats             Republicans
                                                                                                                                 Less      Graduate
                                                                                           Favor                   Favor
                                                                                                                                Favor         Favor
 Providing more incentives for people to save money.                                                94                  93          91           95
 Creating stronger requirements that companies explain their
                                                                                                    91                  92           90             93
  charges in simple, uncomplicated language.
 Cracking down on abusive practices by lending companies.                                           87                  82           81             93
 Lowering the cost of living with things like affordable health
                                                                                                    96                  81           88             86
  care, housing assistance and low-cost student loans.
 Providing more education and counseling to consumers.                                              96                  91           92             94
 Passing rules that would prevent lending institutions from
  engaging in abusive practices that would put consumers in                                         87                  82           81             90
  unaffordable debt.
 Putting a cap or limit on the rate of interest credit card
  companies can charge, even if it means some people will not                                       85                  84           81             85
  have access to credit cards.
 Providing an easy to understand government rating system on
  financial products that tells people how fair a product is to                                     88                  84           85             87
  consumers.
 Banning credit card companies from raising your interest rates
  if you make all your payments on time, even if you miss                                           78                  77           71             82
  payments on other debts you owe.
 Increasing competition by giving incentives to reputable
  lending institutions to compete with pay-day lenders in low-                                      71                  67           68             65
 income neighborhoods.
 Please tell me if you favor or oppose the following suggestions for addressing the household debt problem.
                                                                                                                  Page 15 |   Greenberg Quinlan Rosner
                                                                                                                              Public Opinion Strategies
Support for policy solutions cuts across gender lines as well

 Please tell me if you favor or oppose the following suggestions for addressing the household debt problem
                                                                                                           Men      Women
                                                                                                          Favor      Favor
 Providing more incentives for people to save money.                                                         92           94
 Creating stronger requirements that companies explain their charges in simple, uncomplicated
 language.
                                                                                                             91           92

 Cracking down on abusive practices by lending companies.                                                    86           88
 Lowering the cost of living with things like affordable health care, housing assistance and low-
 cost student loans.
                                                                                                             84           91

 Providing more education and counseling to consumers.                                                       92           93
 Passing rules that would prevent lending institutions from engaging in abusive practices that
 would put consumers in unaffordable debt.
                                                                                                             83           86
 Putting a cap or limit on the rate of interest credit card companies can charge, even if it means
 some people will not have access to credit cards.
                                                                                                             82           84
 Providing an easy to understand government rating system on financial products that tells
 people how fair a product is to consumers.
                                                                                                             85           86

 Banning credit card companies from raising your interest rates if you make all your payments
 on time, even if you miss payments on other debts you owe.
                                                                                                             75           79
 Increasing competition by giving incentives to reputable lending institutions to compete with
 pay-day lenders in low-income neighborhoods.
                                                                                                             71           63
                                                                                              Page 16 |   Greenberg Quinlan Rosner
                                                                                                          Public Opinion Strategies
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                                                                                      Public Opinion Strategies

				
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