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The bank regulators and the Federal Reserves are paying close attention and expressing concerns that the rise in delinquency go beyond mortgages.

Bank of America executives said that credit card delinquencies in California, Nevada, Arizona, and Florida-states with the highest foreclosure rates-increased five times as fast as  in other states, suggesting that consumers struggling with mortgage debt are also struggling to pay there credit card bills. 

The sub-prime mess has left banks with tens of millions of dollars in debt and led them to tighten lending standards. This also led credit issuers to tighten there credits.  

Despite the Federal rate cut the APRs on credit cards have rise.   This rate increase are for individuals that are at higher credit risk because:

• Your credit score has decreased
• You applied for too much credit
• You have too many balance transfers between credit cards
• You are using more than 30% of the available credit limit
• The credit card company uses universal default

 Bank of America spokeswoman Betty Riess says that when they review the individuals account for risks, they also take into account other outside criteria such as taking out numerous loans and using all their available credit, or defaulting on loans to other lenders.  She adds that only a small percentage of their customers are affected by higher rate increase and by law, customers are notified in advance.  They have the option to reject the terms and pay off their due amount.

Only individuals with a high credit score can take advantage of the Federal Reserve rate cut.  But if you are one of the few that are going to have a rate increase, it is important to read and keep all the statements and letters a credit card company sends you.  Look to make sure you how much the increased rate is.  See if there is an option to reject the increased rate and  be able to pay off the outstanding balance at the original rate and close the account.  Try to negotiate over the phone with the company to lower the interest rate and paying down the balance.  If you can not do neither of these then shop around and transfer it to another low-interest credit card.