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Credit Issues: Abusive Practices against the Military
HSBC Bank is one of the largest credit card issuers in America. This financial services organization provides mortgage and commercial banking services, personal financial services and so on. The bank caters for both, individuals and businesses. Besides, HSBC Bank is known to be one of the leading sub-prime lending providers. Issuing credit cards for fair, bad and no credit is their specialty.
But good and excellent credit owners can also find profitable deals for them. This way HSBC Bank used to be all things to all men. However, there is always somebody who is not satisfied. This time the role of the discontented was played by the military.
In fact, the US military personnel on active duty have a number of advantages over all other US citizens when it comes to credit cards and loans. The military people are protected by the Service members' Civil Relief Act. This Act stipulates the financial relationship between the lender and the borrower who is on active duty in the military. The Act relieves the military from legal and economic pressure.
As to credit cards, loans and mortgages, the Act obliges the lenders to keep the interest rates for the military on active duty below 6% or 6% sharp, not higher, regardless of the military service period carried by a soldier.
Recently HSBC Bank was accused of violating this Act's regulations. They were caught on applying predatory practices to US soldiers on duty in Iraq. The bank evaded the law and keeps charging military personnel interest rates that most of soldiers are just cannot afford to pay off. The rates are way beyond 6%. The bank, trying to make up for the losses caused by a credit crisis, decided to get more revenues from bad credit card owners through resorting to abusive credit card practices.
Even in case a military got wounded and was physically unable to make payments, he still remained an object for debt collectors.
As compared to Chase Bank card issuer that respects and honors the US military personnel, HSBC bank runs like a hairy goat in this situation. Chase Bank sets strict APR caps for the military, sometimes they even exercise waiving credit card late payment fees.
The military feel discriminated against. HSBC treats other consumer categories, business owners and students, for instance, better. These clients get no annual fee cards, low interests, beneficial rewards programs. Especially at this point the actions towards US soldiers are simply outrageously unfair, if not to say illegal.
It will not take days or months to understand the reasons for such HSBC's policy. It is the sub-prime lenders that the credit crisis affected the most. And now they are trying to recoup for the losses. However, it is not an excuse for such financially abusive attitude. Especially towards the people who protect our country.
HSBC will have to work hard to win the trust of the military back. The bank could stop breaking the law and act upon the Civil Relief Act, just for a start.
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