The middle class gets whored differently than the poor

One of the most profound changes in "access to capital" that has happened in the past decade is how everything (for the poor and middle class) is being funneled into schemes which are rich in penalties and short on benefits.

In the last millennium, you could go to a bank and get a loan or line of credit to consolidate and pay off debts. For between 8 and 12% APR, you could get a loan to pay off credit cards, personal debts, etc. In this ideal case, everyone wins. The bank got some interest and the debtor got to reduce their interest payments.

Now it is impossible to go to any corporate bank and get an unsecured loan for $5,000. I tried this a few years back and Skank of America and they told me that they don't do that sort of thing anymore.

What is odd is that for this amount of money, I get credit offers all of the time from Skank of America but the financing is always tied to a credit card. I'll use one example I got recently. The bank is more than happy to loan me money, but at the cash advance rate (15.9% APR), and hope that I am late with the payment (the rate then jumps to 24% APR and I get a 50 dollar late fee which is also subject to the 24% rate). This is "access to capital"? No this is "access to poverty".

Acting as a cartel, corporate banks have prevented most people from reasonable access to a credit union using, shock, the Federal Government. These are the same businesses that DETEST regulation. But when a banking entity comes along that serves its members and not its shareholders, the corporate banking industry acts as a single voice to squash these institutions by limiting their clientele.

Now I ask you, does that even sound remotely fair? In the land of the free, I cannot chose among a range of competitive products? This cartel-like behavior means that middle class people who could benefit from being in a credit union and building their credit rating and saving money from reduced penalties and interest are denied that chance and then left, metaphorically, swimming in an ocean full of sharks.

This sort of predatory behavior which targets the middle class is similar to the games banks play with the lower classes (see next post). Why anyone who is middle class would CHOOSE to do business with a corporate bank is beyond me. But then again, what choice do most middle class people have? Corporate banks have restricted credit unions to such a degree that few of us can qualify. And credit unions work for the members. I got my unsecured loan from SECU (in North Carolina) with very favorable terms and I feel good that my money is going back into a system which helps others in the community.

It is a disgrace that competition is being squashed by the cartel of banks and this is done by Congress. Our own representatives are whoring us to the banks by restricting our choices and our access to capital.