Grrrr.... sneaky credit card

[CheshireVal]

I am so irritated with Chase right now. A while back, they bought out one of my credit cards and tried to raise the APR way too much for my tastes. So, I wrote them the "I reject these changes" letter and closed my account. I've been slowly paying it off since then. Since it's closed, it hasn't been my top priority to pay off-- I've been throwing money at my other cards instead.

So, yesterday I get a statement in the mail (looked like junk mail, of course) that said they were raising the rate on that card to 31%!! Even though it's closed, and I had rejected the earlier rate hike. I called the company and spoke to a supervisor about just what the heck was going on, and she said that as long as I have a balance on the account, even if it's closed, they have the right to raise the rates and I just have to keep writing rejection letters every time I get a notice.

Now..... why would I agree to a rate hike when the account is closed? I'd have to be a moron.

I really had no idea they could do that. Going to check my credit report now just to make sure there's nothing funky on there, too. My credit has always been average-- not stellar, not awful. I've never missed or been late with any type of payment, so I'm not even sure where this 31% is coming from.

 

[AliciaS]

Clark Howard talked about this a few days ago. He said that you should NOT close an account with a balance because they will raise the rate on you. Now that the account is closed, they have no incentive to keep you happy and basically do whatever they want to you!

 

[CheshireVal]

It's kind of a double edged sword, then. If I didn't close the account, they were going to raise the rate. Now that I have closed the account, they still want to raise it!

Oh well-- I'll just work harder to pay it off ASAP.

 

[Free4Life11]

Wait a second, you can reject the interest rate hikes? Citibank doesn't even send me a notice when my interest rate goes up.

 

[KTSMOM]

I would suggest seeing if you can find a lower rate CC that you could transfer the balance too. The OP is right that now Chase won't work with you to get a lower interest rate since you've closed your account.
Good luck with it all!

 

[CheshireVal]

I bet they do, but they like to hide it in the form of junk mail.

 

[mtblujeans]

I did that once.....I learned the hard way, too. I got upset because they kept raising the rate so I closed the account "in protest" and was still paying it off. Then, I saw (some where) that if you close the account with a balance on it, it will negatively affect your credit. Oops! And, sure enough, the company raised the rate on me so high it was ridiculous!! I don't think credit should be a game!!

 

[CheshireVal]

Yes, the credit card thing TOTALLY feels like a game for me, and I'm always losing.

I went a little credit card crazy in my early 20s, and am suffering the consequences now (at 31). I could just KICK myself for being so stupid back then.

Oh well. Lesson learned. Balances coming down. My credit has never been bad because I have no missed or late payments. It's just a little high in relation to my income, which is causing these annoyances to happen. Hopefully in a few years this will mostly be behind me!

 

[DisneyArk]

Dealing with credit card companies is no fun.

Did you watch the Debt Diet on Oprah recently? The financial advisers said to NEVER close an account that has a balance. If the credit card company wants to raise your interest rate, you have more leverage if your account is open. The advisers said to call the company and ask them to lower your rate or you will transfer your balance - keep asking to talk to managers higher up until they agree to lower it (instead of raise).

Once the card is closed then the credit card company knows they will not be getting more money from you - so they are not as likely to cooperate.

Can you transfer this balance? I would not want to pay 31%.

BTW - it's my understanding that credit card companies can raise the interest rate at any time without your consent.

 

[Straitlover]

I'm surprised they didn't make you pay your acct in full when you closed it. I just closed my acct w/ RBS after many years because they're jerks, and they sent me a letter requesting payment in full within 3 weeks. I only owed them around $180 (I paid it off in full each month); maybe that's why?

I hated to close the acct becasue of my long history w/ them (10+yrs), but they changed the grace period and due dates w/o telling me, which caused me to have a late fee hit my acct. Because of the changes, if I did not mail my payment within 2-3 days of receiving the bill, it would always be late. However, the due date would be before payday, and I'm not going to mail them a check that might bounce, and I don't do online payments (sorry, not giving them access to my checking acct!). They refused to change the billing date so I would have enough time to mail it in, so I told them to kiss off and close my acct!

I would definitely look into transferring your balance to another acct.

EDIT: Oh, and even though my acct is closed (got the letter to prove it), they keep sending me checks I can use on it!

 

[MissingMickey]

I also watched that Oprah episode. Seems like the gentleman on the panel said he was able to go back in for a client and reopen accounts that were closed so that he could negotiate lower rates, pay off and then close. Would that be an option? Definitely check your credit report.

 

[mtblujeans]

....EDIT: Oh, and even though my acct is closed (got the letter to prove it), they keep sending me checks I can use on it!

I have closed credit card accounts that have done that. I kept calling them wanting to verify that they had indeed closed that account and the checks eventually stopped coming.

I once had an AMEX thru Costco that had been closed for at least a year and, when my membership came due, Costco charged it to that card so AMEX reopened the credit card account! I called AMEX and they said they had no control over the account and that I would have to close it thru Costco! WHAT?? So I had to call Costco and have them back that charge out - which they did not want to do - then call AMEX and have them close that account again. I paid the Costco membership with a check. It was a mess. In the mean time, Costco dropped me from my membership and I didn't get the discount coupons in the mail any more. We have been members for years and I didn't think that was the best way to treat long-time (business) members!

 

[msblrobs]

Can I jump on the bash Chase bandwagon? They recently bought out my SW Visa card also and changed my payment due date without notice. That ticked me off, so I sent them a nasty e-mail indicating I thought it was also a sneaky practice and I didn't appreciate it. I then spoke to customer service and was told that credit cards can change the rate and payment due dates at will WITHOUT NOTICE TO THE CUSTOMER!!! My reply e-mail from Chase indicated they lowered my float days since I pay my balance in full each month. It also went on to say that I am basically getting a 45 day interest-free loan on purchases. Why do I need attitude from them just because I am a good customer who pays the entire balance on time?! Sorry I will NEVER pay interest charges to them but that is the product they offer. I merely use it as a vehicle to get southwest tickets to travel for free.

 

[Teacher03]

I made the mistake of closing a credit card account with a balance on it. After about 6 months of closing it, they hiked up my interest rate. I called and asked if I could reopen the account. Nope, sorry, it has been closed too long. This was Bank of America. I was furious (mainly at myself) because I thought I was doing the right thing by closing it. Never again, I learned my lesson.

 

[CheshireVal]

Thanks, everyone.

To me, this is just another reminder of why credit card debt is evil, evil, evil.

For now, I'm going to go ahead and write my "I reject this" letter, and in the meantime I'll crunch some numbers and figure out how I can get out from under all this plastic as soon as possible!

I did pull my credit report and all my accounts are in good standing-- no late or missed payments ever.

I think my debt to income ratio is just too high and that's why they like to increase my interest rates so much.

 

[looo33]

I did pull my credit report and all my accounts are in good standing-- no late or missed payments ever.

I think my debt to income ratio is just too high and that's why they like to increase my interest rates so much.

OK....I have to make a confession....I don't know how to do this. Can someone tell me...step by step...how to get my credit report? When should I check it? How often? What is a good score?

 

[Lisa_M]

I would suggest applying for a new card. I get these 0% offers in the mail alot (latest 0% for life from Discover). Make sure it's 0% or something low on balance transfers and balance transfer it away. I don't know how large a balance you have, but a low interest rate and 3% or $50 BT fee is better than 31% any day of the week. If you can't BT to one card, BT to more than one. That interest rate is highway robbery and they make out really good on ppl like you and me who always pay on time and pay the minimum or not much more than the minimum. I think that is why they raise rates...they know you'll continue to make good on your debt to them.

Good Luck!

Lisa

 

[jenr812]

OK....I have to make a confession....I don't know how to do this. Can someone tell me...step by step...how to get my credit report? When should I check it? How often? What is a good score?

Go to www.annualcreditreport.com You can get a copy of your report from all three bureaus there along with info on the other questions you asked. HTH

 

[seashoreCM]

Why do I need attitude from them just because I am a good customer who pays the entire balance on time?! .

People who pay off the entire balance to avoid finance charges are not the bank's good customers! The good customers pay just the minimum payment and pay finance charges and stay in debt for decades.

Disney hints:
http://members.aol.com/ajaynejr/disney.htm

 

[diannaneglia]

What happens if you don't have a balance on a credit card and you don't close the account for months even years...