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Credit Card Applications » News » Other » Is it worth opting for the payment protection programs for credit cards

Is it worth opting for the payment protection programs for credit cards

October 16, 2010 | Updated on October 16, 2010
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The content is accurate at the time of publication and is subject to change.

Over the last few months, debts on credit cards have been taken seriously and customers are ensuring they make their payments on time and regularly to avoid getting into the bad books and spoiling their credit worthiness.

There are some credit card lenders that do offer programs such as "payment protection" for consumers who call them and let them know about the financial hardships they are facing. Under this program, the bank will suspend payment collection from the customer for a few months.

While most people were under the assumption that these programs were designed for their benefit, the Baltimore Sun Blog, clearly outlines that a few experts in the financial sector were not recommending these programs because most of the programs did not live up to the expectations. They recommend Americans not to register for this program paying money. A number of payment protection programs have a long list of qualifying criteria that makes it difficult for most borrowers to avail it even in dire circumstances. In fact, there have been lawsuits filed against most lenders for not revealing the complete details of the payment protection program well in advance to consumers.

One of the most recent lawsuits is the one against JP Morgan Chase which brings into focus the predicament of customers when they sign up for the payment protection program without having complete information about the terms and conditions associated. According to Baltimore Sun, John David, who holds a Chase credit card, registered for the program while retiring and after paying the expenses and fees for a period of nine years, he was told that he was not eligible for the program.

The spokesperson for Consumer Action, Linda Sherry, told that the payment protection programs are bound by innumerable conditions and exclusions that make it tough for consumers to qualify. Speaking to the newspaper, she also said that consumers have to face a lot of hardships and overcome a number of obstacles in order to qualify for the benefits of this program.

The objective of the civil lawsuit filed against the bank is to expose the various misleading practices by the banks just with the intent of making money. Most of the banks do not check the qualifying criteria of the person before they register for the program. On the contrary, most banks just accept the registration and months after the customers pay the fees to the bank, they let the consumers know about their disqualification.

In order to avoid falling prey to these practices, it is imperative that consumers read through the terms and conditions well in advance before signing up for it.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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