 |
|
Credit
Card Rate Increase
Fighting an Increasing Rate by Scott Bilker
Scott Bilker is the author of the best-selling
book "Credit Card and Debt Management."
He is also the Editor and publisher of the FREE
DebtSmart® E-mail Newsletter (http://www.debtsmart.com).
Scott,
I had a card that had a fixed rate of 5% on my
balance. I closed the account years ago when I
started taking control of my debt. Since this
was the lowest rate of the cards I had I was only
paying the minimum and concentrating instead on
paying off other high interest credit. I received
a notice with one of my invoices that they would
be increasing the rate to 20% and that I basically
didn't have a choice in the matter (fine print).
I transfered the balance over to other cards that
would have a lower APR than the 20% they would
be imposing however this severely limited my available
credit for emergency purposes.
Just wanted to know if it is legal for them to
increase the rate on a closed account and if there
was any other option for me to consider. Obviously
this would be information for any future similar
situations. Thanks!
--Mike
Answer
Mike,
Do you have the original paperwork that gave you
the fixed rate of 5%? I truly hope so because
it's that documentation that could ultimately
help you keep that rate. The only problem is that
you did transfer the balance but you did so because
you thought they wouldn't keep the rate at what
they promised.
I see this happen frequently that's why I ALWAYS
keep copies of the letter, terms, conditions,
etc. in my files for just such a situation. I
even photocopy applications!
If this happened to me, and I found evidence that
they couldn't raise the rate, then I might even
contact a lawyer and see what could be done. I
would also contact the Federal Trade Commission
and other consumer groups to see if they could
help me make the bank honor their agreement.
For the future...get everything in writing and
keep it in a file!
Good luck and please let me know what happens.
Scott
Please fill out the Christian debt information request form on the right to request more information about our Christian debt programs.
|
|
|
