Anachostic

I just got a notice from my primary credit card that they are raising my interest rate, from 14.99 to 19.99. I'm a little perplexed by it, because I have excellent credit and I pay off my card every month. I have been a cardholder since 1999 and have never carried a balance.

Is the CC company gambling with me? Since I use it as my primary card and pay it off every month, it's usually a $2k statement each month. Are they calculating that one of these days I'm not going to be able to pay it off in full and they're gonna get a big payoff in interest?

I'm looking at my other cards and I've got other shitty rates like 12.65 and 16.99 (x2). Although my credit is excellent, is my habit of exclusively charging on one card encouraging these companies into placing bets against my positive history? Or are they sick of not making any money off of me and want to drive me off?

I'd rather not split my charging onto different cards because it's a bigger hassle and my card rewards won't grow as fast. Someone relate a story of how they called the CC company up and demanded their rate be lowered. I could use some ammo. Thanks.

moeronn

What is the main reason you use this card?

Generally, if you have good history, you should be able to call them and have them reduce the rate. Usually they will do it. Sometimes they won't - some cards have a minimum rate they will go to.

As for ammo, you just need to tell them what you posted above - you've been a customer for nearly 10 years, have excellent credit and have always been on time with payments. If this particular card doesn't really mean anything, you can always threaten to cancel the card if they refuse.

Of course, all of this is pretty much moot if you never carry a balance.

eve

Is it a Citi card? I got one of those letters a couple of weeks ago.

Anachostic

It's my everything card: food, gas, bills. If I can charge it, it goes on it.

I considered the fact that it doesn't really affect me since I don't carry a balance. Maybe I don't need to think much about it because if I ever hit the skids and couldn't pay it off, I could just get one of the low APR transfer offers or play the other cards against each other to get the balance.

I'm getting suspicious because all my cards have been slowly hiking their rates and looking back, it's almost parallel to what percentage of my daily expenses I would charge to them. Now that I can (and do) charge fast food and my $2.65 breakfast on a card, they seem to be jacking it up more and more.

My brother doesn't use his card much - mostly cash living - and his rates are like 7% and 9.9%.

Yup, Citi Driver's Edge. I'm saving up points to help with a motorcycle purchase.

moeronn

^^ I think that cards with rewards programs are doing this more. If you weren't getting anything out of the card, then I would use a different one, but since you want something from this card you will have to play their game. Still, definitely give them a call and see what they can do for you.

MR1

Check recent news...most of the majors are or will be doing it. Banks have lost a ton of money are are looking for profit. In addition, cardholders are defaulting at increasing levels on their monthly payments. We should all be watching everything we get from our banks, more bad news and actions are sure to follow.

Let us know if you have success in getting them to lower your rate. BTW, they are also lowering credit limits.

agranado

my citicard just stuck it to me hard too. I was at 13.99, now its at 19.99.

I've got a citi diamond perferred card... it's tempting - they just upped my limit to 8700... but I just xferred the balance off it and now i'm in less of a rush to start using it again...

Bearcat94

What just drives me right over the edge with these games is that the interest rate change, effectively, becomes retroactive.

Say you do carry a balance. Say that most of that balance is some thing or another you bought 3 months ago when the APR was 14.99%. Assume over the 2 intervening months you've paid off 1/4 of what you charged.

Now, in month 3 the cc company raises your rate to 19.99%. That applies to 3/4 of the money you "borrowed" 3 months ago at 14.99%.

They want to change the rate on money borrowed from this day forward - no problem. But to change the rate on money borrowed under a previous agreement is .



OP - if you're paying it off monthly, what difference does it make what the interest rate is? And "rewards" cards almost *always* have a higher interest rate. Those rewards aren't supposed to be free.

Fossil_TL

if you pay off your card every statement cycle full, then the hiked interest rate should not be a worry for you, even if you miss a payment, just have to call them up, usually they are lenient enough to let your make mistake like late payment once a year.

adrian_04tl

[QUOTE=Anachostic;10241939]

My brother doesn't use his card much - mostly cash living - and his rates are like 7% and 9.9%.



QUOTE]

that sounds about right. mine are at about 8.9-12 APR

my credit is ok

ofcourse my limit on these are only 1,000-2,500 (i wonder if limit plays a role in the APR?)

doopstr

Citi is in big trouble they will do anything they can to raise money.

I just checked mine and I'm still at 10.99%

NSXNEXT

iTrader: (2)

Every card issue is going to start doing this. Is no one reading the finance section? Things are expected to get much much worse next year.

The people who didn't foreclose on their mortgages did so at the sake of their credit card. Now their going to struggle to make card payments... the rest is history.

TzarChasm

I got a letter stating "in order to better serve our customers we are raising our rate to 24.9%" (from 12%) I called them up and said "how does that better serve me?"

Of course the lady on the phone had no answer, so I just said nevermind, cancel it. I had to send a letter, can't do it over the phone, but whatever.

The part that pissed me off the most was the "in order to better serve you". Please, if you want to try and screw me, fine, but don't lie about it. Credit card companies are scum.

agranado

wow.. what company? ^^ More citi? Sounds like the post I received...

doopstr

BTW, I seen on TV yesterday that Chase has been lowering credit limits and closing accounts with $0 balance.

taitando

Yup. Citi is not the only culprit. We are in a "Credit Crisis" so of course Credit Cards are included in the mix. Chase, Citi, American Express, etc... are all taking measures to limit their losses. And the slap in the face? It doesn't matter if you've been paying on time or carrying no debt.

Anachostic

"I never thought it could happen to me."

JediMindTricks

same thing's happened to me.



sucks but even more reason to stop spending and pay them off.

doopstr

Damn it, I cursed myself. I got notice in the mail saying they closed a Visa account I haven't used in 2 years.

Anachostic

Your only recourse is to not accept the rate change, then you can pay off your balance at the old rate. Of course, then you have a closed account in your credit file, less available credit, and possibly some credit history.

"Games" really is the best description of what consumers have to go through for credit.

Eoanou

I'm still glad that when I applied and got approved for my CapitalOne card they offered a 0% APR on all purchases til Feb. '09 and they promised to raise my limit after 3 months, which they did. Almost every one of my purchases in the past four months has been with this card, although now I'm starting to bring my balance to $0.00 so that I won't have to worry about the interest come Feb.


I have noticed that I haven't been recieving any credit card offers in the mail anymore, for me nor anyone of my family members, when they used to send tons every week.

BTW I got the card in August of '08.

sho_nuff1997

iTrader: (2)

My Home Depot card got raised from 15% to 24%. Also, my paypal credit got reduced $100 from $1000 and I never carried a balance on that. Hell, I only used it a couple times. I think it's a sign of the times more than anything.

Anachostic

Argh. Just got a notice from Chase: "..this credit card account hasn't been used for at least 24 months... the account has been closed."

Oh well. A member since 2000 just lost $6k of available credit. Simplification, right?

sho_nuff1997

iTrader: (2)

I am curious if the CC companies are charged if the account is unused? They obviously aren't making any money from you, but I would think it would be better to have more open accounts than closed. I mean there is always a chance they will get used.

doopstr

It must somehow improve their balance sheet to not show so much unsecured credit issued. If they take the $10k of credit away from me they can give it to someone else that would actually use it.

Just got a shiny new Amex Blue Cash card to replace my Chase Visa.

moeronn

I wonder if stores will start doing this, too. I haven't used my Sears, Home Depot or any other store cards in years.

videojock

I had a similar situation where Amex lowered my CL on my Platinum Business Cash Rewards card. I raised hell and they eventually gave me my original CL but I haven't used the card since I started exclusively using the Gold charge card.

For those not using older cards for years. Wouldn't it make more sense to charge something on them periodically so your credit file shows a longer credit history?

Anachostic

I hope you're not holding on to and paying $450/yr for an Amex Platinum you're not going to use.

I recently dug out an old Mastercard and charged about $40 on it to keep it active. Unfortunately, I didn't think I left my Chase card inactive that long. if I wasn't hoarding rewards points, I would cycle my cards throughout the year.

In probably unrelated news, my local Burger King now makes you sign the credit card receipt. I guess they're trying to protect themseves from chargebacks.

Anachostic

This got me thinking, so I checked the only card I had, Best Buy (unused for 4 years): Logged in to account manager and got "Your account has recently been re-evaluated." I guess I know what that means.

Bearcat94

Oddly enough, today, I got two peices of mail from lenders where I have credit accounts (one CC and one a kind personal line of credit). Both raised my credit limit.

The CC by 20% (it has $0 balance, btw) and the other, if I am not mistaken, by ~25%.

Also, while I've seen a decline in new CC/Line of Credit offers, they have not stopped. My wife and I still get get 2 - 5 per week.

Of course, we are old ( ), established and stable (same house, same job looooooong time), so that's a factor as well.



Edit - Not *too* old relative to many in this thread. OTOH, I have a kid older than a few of you.

wasupdog

iTrader: (2)

i just checked up on my (many) credit cards yesterday cus i'm going on vacation soon out of the country and need to decide which ones i'm going to take. my cards are basically the same as they've been. on 2 of them the apr went down but the cash advance rates doubled...although i don't use the cash advance, i check to see what the rates are.

i'll still be primarily using my capital one card which has a really low apr and no fees for international atm withdrawals or cash advances so i use it like an atm card overseas. my credit history goes back to about 1996 or so.

Bearcat94

Here's a cute twist:

On a store installment/LoC account where I carry a modest balance, the credit carrier (Chase or Citi) sent me a notice.

- They raised my Credit Line by ~50%.

- In addition, they are raising the interest rate by ~7 points.



The "options" they provide:

- I can accept the new rates and pay the add'l 7 points on my current and/or future balances;

OR

- I can "opt out", close the account, and pay the existing balance at my current rates and terms.



I have not put any purchases on this card in a year or more.

"Uhhm, yeah ... can you please sign me up for the consensual rape program. I want to borrow more money and pay higher rates on an acount I don't use very often."

How F'kg stupid is that?


Honeslty, the part I don't get: Why bother with the big credit line increase? Why not just do the normal sleazeball thing and raise the interest rate and see if the slips by?

The other thing I don't get: Aren't interest rates (for them; big banks) lower than ever? So, they get their money at bargin basement rates and charge me buttsecks rates? "Duhhh, Okey-Dokey, count me in."

:fukoff: :thecheckisinthemail:

Anachostic

That's an interesting way for them to get their money quickly and get rid of you at the same time. I haven't seen that one before. I wonder if it's targeted for those with balances.

Anachostic

Oh, and perfect timing: http://finance.yahoo.com/banking-bud...Less-Rewarding

I just had three month's worth of rewards expire on my last statement. I'm not sure if they were really that old (5 year life) or whether I've just been ripped off.

moeronn

I will say this again - Amex Costco Card FTW!! The rate isn't that good (~%15), but cash rebates. Great card if you don't carry a balance. I just wish they paid out more frequently. We should be getting a check for ~$600 next month.

Bearcat94

I think I am just going to pay off the balance, leave the account open (i.e. Opt In to the consenual rape program). Then, every month, charge about $5 and pay it off when the bill comes.

If I they want me "cancelled" I want them to lose money on me as a customer.

yunginTL

Amex did a financial review on me, after i charged 3x my salary from last yr in less than 3 months. Then they slapped me with a limit on my charge card... it makes sense though. Credit crisis it is.

badconexun

Yeah I just got punched. Both of my WAMU cards (recently purchased by JPMorgan), went from 9.9% to 17.9%. I typically carry a balance under 30% of the limit, but decided to pay them off this morning. I even threatened to close the account or stop using the cards, they didn't budge and encouraged me to write a letter to cancel the accounts. How will they keep customers like this?

special-ed

With the Feds there to bailout JPMorgan, why would they need to? All the reason why to properly diversify yourself and put hedges in place.

When the bank decides to reduce your equity line of credit on your home and on top of that, won't divvy up any loans against that line, where do you go for money that is needed?

When the credit card companies decide to reduce your credit lines significantly on the drop of a dime, where do you go when that extra cash is needed?

When you're in between jobs and unemployment benefits aren't enough to cover rent or the mortgage, what do you have in place?

When the sh*t hits the fan and creditors start coming after your assets, what part of your portfolio is shielded from their greedy hands? In the meantime you still have to put food on the table and pay the bills...

All the more reason to create a personal bank....the Bank of "insert your name here".

moeronn

^^ And I wonder what you suggest to accomplish that?