Whats Going On In Your Wallet?
By Consumers Union on Thursday, August 20th, 2009
Recently, Congress passed the CARD Act which will put in place reforms to protect consumers from unfair credit card practices. But since most protections will not go into effect until February 2010, the card companies are implementing a new egalitarian business practice, Rip off everybody!
Consumer Action just released their annual credit card survey and focused this year on practices that will be restricted when the Credit CARD Act takes full effect.
The survey found that
“nearly all surveyed issuers have at least one practice that will be prohibited or limited by the new law, including anytime any reason changes in terms, payment allocation, early payment cut-off times on the due date, penalty rates and penalty fees, and universal default.”
|Bank/Card||Increase in Purchase APR||Increase in Cash Advance APR|
|Bank of America Platinum Plus Visa||Up to 46%||Up to 21%|
|Bank of America Platinum Plus Cash Rewards||Up to 33%|
|Bank of America Accelerated Rewards American Express||Up to 33%|
|Capital One No Hassle Miles||Up to 8.6%|
|Capital One Standard Platinum||Up to 8.6%|
|Citi (all three surveyed cards)||Up to 26% – 42%|
|US Bank Visa Platinum||Up to 25%||Up to 9.5%|
|US Bank Travel Rewards Visa Platinum||Up to 25%||Up to 9.5%|
|Wells Fargo Cash Back||Up to 4.6%||Up to 8.5%|
|Wells Fargo Platinum||Up to 13%||Up to 8.5%|
Across the board the credit card industry has reneged on their agreements with consumers. But we knew that already. When we asked you to share your recent credit card experience we learned that people with excellent credit histories are seeing their low rates increased their fixed rates turned into variable
Two weeks ago, I found out that my interest rate was changing. I went from an 8.9% fixed rate on a credit card I have had for 23 years, to prime plus 16.99%. I was shocked. I’ve never paid late in 23 years, and always pay the entire balance off each month.
-Eric from Texas
And that their credit limits slashed and the minimum payments more than doubled
Even though I’ve always paid more than the minimum, and always paid on time, they doubled our minimum payment. When I called to ask why, they gave me an option — I could go back to the old minimum payment, BUT only if I gave up the promotional interest rate (3.99%) and they raised the rate to 7.99%.
-Rosemary from New Jersey
If only there was an independent watchdog with the power to reign in the credit card companies.
Whats in your wallet? Please tell us about your recent credit card experiences in the comments or on the Share Your Story action.