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15 October 2008

Good thing I pay off my credit card every month... [More:]because I just got a notice saying they were jacking up the interest rate to 30%!!!!!

Are they trying to ask me if, brother, I can spare a dime??
Jesus fuck! (Note to self: check current interest rate.)
posted by sperose 15 October | 16:53
Really, every credit card contract I've read recently (and I DO read them) say they'll ONLY raise your rate if you miss or are tardy with a payment (or showed some other sign of less-than-credit-worthiness). Or did you fall out of the 'preferred' group a long time ago and never got put back, no matter how good a boy you are?

Which raises the question: how smart it is to raise the charges on someone who already is having trouble keep up payment (NOT talking about you). It's like they're saying, "our only option is to wrench all we can out of you while we can"
posted by wendell 15 October | 17:02
I love that I just got that usual letter from Wamu saying I had BETTER sign up for their credit protection plan if I knew what was good for me.

They have some nerve, all things considered.
posted by small_ruminant 15 October | 17:06
they day they were bought out both my roommate and I got "you're preapproved for a visa" notices from them.
posted by kellydamnit 15 October | 17:20
Which raises the question: how smart it is to raise the charges on someone who already is having trouble keep up payment (NOT talking about you). It's like they're saying, "our only option is to wrench all we can out of you while we can"

I have wondered this for YEARS. Literally, at least for the past 2 years, I suffered through sweating to make my stupid B of A payments to lower my interest rate from 36% (!!!) to the standard because I had been pretty tardy with payments.
posted by TrishaLynn 15 October | 17:28
This particular account has been in use--and paid in full without fail--for more than ten years. They just "upgraded" the card to a new program about a month ago, and I haven't yet read the rather thick terms and conditions, but I'm just betting you Chase was "upgrading" us so they could also "upgrade" the intrest rate.
posted by WolfDaddy 15 October | 17:53
I used to do customer service for a company that handled calls for a credit card company (let's call them, I dunno, "Latipac Eno"). Your interest rate is NOT set in stone, and there's a LOT you can do to get it lowered. It takes persistence and knowing who to lean on when. I'll tell you how:

First, WolfDaddy, the chances are good that your credit card company doesn't want you as a customer. You're their nightmare customer -- you use the card all the time, and then you have the temerity to pay it off in full every month! How dare you! How are they supposed to make any money if you're not falling into the interest trap? So, consider switching to a different card. American Express is a pain in the ass, isn't accepted everywhere, and has terrible customer service. But, they have some nice benefits depending on the card, they have good travel discounts, and their cards are slightly thinner, making it easier to cut cocaine with them. Anyway, call your current card issuer. The chirpy associate who answers won't be able to do diddly to change your interest rate. But, he or she will be more than pleased to transfer your call to the "Retention" department. These are the people who are actually authorized to make changes to your account. They are, without fail, sneaky evil people. Threaten to cancel the account if the interest rate isn't acceptable. They'll counter-offer with a rate of, say, 25.9%. Laugh at them and request to cancel the card. They'll counter with 22.9%. Laugh at them again and tell them you don't have time for this and you've been a customer for ten years and goshdarnit they better do something... at this point, the retention agent will have stopped listening and is, in fact, in the break room eating a living baby, toes-first. When they return to the phone, tell them you want to lock-in a rate of no more than 12%. The agent will hiss like a vampire in the noonday sun, and eventually will come around and lower your rate. Make sure you get them to fax the changes to you in writing (they'll say they can't, but they really can).

It helps to call around first and see what kind of rate other companies can give you, so you'll know what the wiggle room is.

NB: I worked this job many years ago, when credit flowed like water. I don't know how the recent unpleasantness in our collapsing economy has affected America's predatory lenders.
posted by BitterOldPunk 15 October | 18:30
30%???? Oh my.
posted by gomichild 15 October | 18:43
I laughed so hard that the baby the retention agent was eating, toes-first, came out MY nose. Thanks for the wisdom and laughs. Flagged as "not to be exposed to sunlight if you work at Latipac Eno, who is in no wise related to Brian Eno".
posted by WolfDaddy 15 October | 18:46
See the recent comments about this on Consumerist. Lots of credit card companies are sweeping accounts that have relatively high credit limits, either raising the interest rate or lowering the limits.
Chase were ahead of the curve here: check if they changed any other conditions, like the interest-free window between purchases and payment due -- that's another favorite of the lower-rent credit card companies).
So - the bottom line is that they are all doing this -- they now have less credit out there (more defaults and lower spending by consumers). They are raising interest rates in an attempt to maintain their revenue model and trying to pre-emempt people using these cards as a fallback if they get into trouble in the recession. Have a look at Billshrink -- I found a really good deal on a rewards card, at excellent interest. I was gobsmacked how easy it was to get a better deal.
posted by Susurration 15 October | 20:19
destroy credit cards. save up an emergency cushion. save for purchases. pay with cash. live under your income level. banks will hate you. oh, and you have no reason on earth to even have a credit card if you are paying it off every month - just put a months expenses in an account and use a check card. end of lecture.
posted by quonsar 16 October | 06:09
Isn't having a credit card (and paying it off each month) good for your credit rating?
posted by matthewr 16 October | 07:21
just put a months expenses in an account and use a check card

Check cards don't offer the same protections against fraud/theft as a credit card. I've had a debit card duplicated, and it was free cash to the people who did it. It also took much longer to sort out than when I lost my credit card. In the former example, even though I reported the illegal transactions immediately, I had to complete an enormous amount of documentation--most of which had to be notarized--and the funds weren't returned to my account for nearly a week. That was my money the thieves spent. With a credit card, it's the bank's money, and they fix THAT a lot faster, for some strange reason.

Your liability is also lower when using a credit vs. a debit card in most cases. You are only liable for $50 in charges with credit cards if a card is lost or stolen. If you're not attentive, you could be liable for all losses when a debit card is lost or stolen or duplicated, especially if the bank has to "hotcard" you more than once a year.

Isn't having a credit card (and paying it off each month) good for your credit rating?

Sure. But also never, ever, EVER let anything get sent to a collection agency. It can haunt you for life.
posted by WolfDaddy 16 October | 08:14
The only reason I have a credit card is so I can use it if I buy something that costs over 100. In the UK, if you buy an item on your credit card that costs more than 100 (for a single item, not a series of items adding up in total to over 100) then you get the protection of s.75 Consumer Credit Act 1974.

What this means is that if there's something wrong with what you buy, or if you don't get what you've paid for, or if the seller goes bankrupt before you get it, then you can claim the money back from the bank which issued the credit card.

I always buy my flights with it, just in case American Airlines goes tits up. But you have to have a direct contract with the company - if you buy through a travel agent, then your contract is with the travel agent, not the airline.

I pay my card off in full each month, and will only buy something on the card if I know I've got the money to pay for it.
posted by essexjan 16 October | 12:12
you have no reason on earth to even have a credit card if you are paying it off every month
1% back in cash. If they let me float my mortgage on my credit card, believe me, I'd do it, pay it off and get that 1%.
posted by plinth 16 October | 14:11
What plinth said. I put all my monthly expenses on my credit card, and pay it off in full.

1) Amex offers buyer protection, should something go wrong.
2) I get lots of money back. About $250 every 18 months or so.

I can understand why people hate credit cards - they do provide temptation all the time ("Charge me! Charge me! You can pay me back over time!"), but that's why I maintain an emergency savings fund as well as a "slush" savings fund - one for emergency purchases outside my monthly budget, and one for entertainment purchases (usually plane tickets, festivals, hotels, etc.)
posted by muddgirl 16 October | 14:51
(I don't pay bills on my CC, so I could be making a lot more.)
posted by muddgirl 16 October | 14:53
I made 1 call to B of A Visa and got my rate lowered, just by asking. 30% is rather eeeevilll.
posted by theora55 16 October | 16:11
Yikes! || Oxygen Water = Snake Oil?