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credit cards, ******

 
 
Reply Thu 26 Nov, 2009 01:39 pm
meself and the lady Diane each use a credit card, she uses Citi Bank and I use WellsFargo. we each got a notice this week, her interest rate was raised to 29.7% and mine was raised to 15.7%. It's not really a big deal as we don't carry a balance but it really pissed me off as we have perfect credit/never late etc. Lady Diane will cancel her card effective immediately (a protest) and I will attempt to convince her to ONLY use our WellsFargo Debit card.
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Type: Discussion • Score: 16 • Views: 3,539 • Replies: 41
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OmSigDAVID
 
  1  
Reply Thu 26 Nov, 2009 02:21 pm
@dyslexia,
dyslexia wrote:

meself and the lady Diane each use a credit card, she uses Citi Bank and I use WellsFargo. we each got a notice this week, her interest rate was raised to 29.7% and mine was raised to 15.7%. It's not really a big deal as we don't carry a balance but it really pissed me off as we have perfect credit/never late etc. Lady Diane will cancel her card effective immediately (a protest) and I will attempt to convince her to ONLY use our WellsFargo Debit card.
I 'm not an expert on this,
but credit cards have some legal advantages
that debit cards don 't; e.g., immunity from liability over $50
for fraudulent use.

(Granted that u 'd probably prevail with the debit card too,
in the event of fraudulent use, but it might be more work.)

Cancel the protest; just don 't use the card, unless u wanna.
dadpad
 
  2  
Reply Thu 26 Nov, 2009 02:25 pm
Do you pay an annual fee dys?
CC providers here in Oz slapped on an annual fee a few years ago. their reasoning was they were providing credit to many people who (by paying the balance off each month) never paid any interest.
0 Replies
 
hawkeye10
 
  2  
Reply Thu 26 Nov, 2009 02:41 pm
All credit card lenders are doing this before the new consumer rights bill takes effect. Also, Citi is a zombie bank, they have no money to lend thus no interest in going after new lending opportunities.

I got a rate increase from citi as well, but had been expecting it for many months. I am going to keep the account open till they start charging a yearly fee, because to close this account would hurt my credit, it has a high limit and I have had it for almost 20 years.
dyslexia
 
  1  
Reply Thu 26 Nov, 2009 02:59 pm
well here's the thing, while I'm not a banker my thinking goes like this, when you have a good/excellent rated customer and you raise the rates to a usury rate you risk losing that customer and only keep the customers with a low/poor credit/payment( that need their card) history thus lowering your profit. We will cancel Citibank and keep WellsFargo (I've had it for 20 years) even though their rate went to 15%, we don't pay it because we clear the account every month (same could be said for CitiBank but egads man 29%??????)
hawkeye10
 
  2  
Reply Thu 26 Nov, 2009 03:09 pm
@dyslexia,
That prob makes sense for you, at your age what do you need a credit rating for? Most people however need to play ball with the credit card companies, because we might need to borrow money at some point and need a good credit rating to do so at reasonable rates.

Edit, however the liability situation on debit cards is not as good as with credit cards, as has been pointed out. Also, now that the Feds have gone after the outragous fees that banks charge on debit card over drafts you can count on banks to make debit cards more costly in other ways.

There is no way around the bank, until banks are reformed citizens will continue to be held up by them.
0 Replies
 
georgeob1
 
  1  
Reply Thu 26 Nov, 2009 03:12 pm
@hawkeye10,
I believe hawkeye is correct ! Government intervention often has unanticipated and undesirable consequences. The legislation in question limits the speed and amount by which credit card lenders can raise interest rates, and the terms of the credit card contract permit mimimal payments and the carrying of debit by cardholders for a long time. These are factors that weren't present when you and the bank agreed to the card's terms. That presents a risky situation for any issuing bank, and one as troubled as Citibank may well lawfully signal its lack of interest in additional loans (or unpaid balances) by raising their cost to what (for them) is a safe level. It is interesting that we are much more harsh in our reactions to the commercial economic actors in this play than in those of the government that pulls their strings.

Since you don't carry any unpaid balance, the "insult" here is theoretical, not real. I would simply use the Citibank card (if that is convenient to you) as a cash substitute and leave any carried balances to the cheaper card.

Imposed annual fees are another thing altogether: payment of them can't be escaped. UBS recently imposed annual fees on a checking account of mine that were specifically excluded from the original deal I signed up for in Colorado National Bank (before UBS bought them). Angry at an after-the-fact and unilateral change in our contract terms, I went to the nearest branch and gave them two choices (1) rescind the fee charges now and forever or (2) immediately transfer the balance to an account I have in another bank and close the UBS account. They rescinded the charges. I'm sure it helped that these charges were small compared to the potential interest charges on a credit loan.
realjohnboy
 
  1  
Reply Thu 26 Nov, 2009 03:55 pm
We on A2K don't like you, Dys, and CITI doesn't like you either. They don't like you because you pay the bill off each month before the due date. You probably charge a few hundred bucks a month. The merchant gets charged around 2.5% but that gets split amongst various middlemen. By the time the cost of maintaining your account, mailing your statement, and the "float" (the amount of time between when you make the purchase until you make your payment) is all factored in, you are losing them money.
The "sweet spot" for them is not you or the customer who is up to the eyeballs in debt and goes into bankruptcy but the person who makes regular payments but can never quite pay off the balance in full.
0 Replies
 
maporsche
 
  1  
Reply Thu 26 Nov, 2009 07:20 pm
@georgeob1,
georgeob1 wrote:

Government intervention often has unanticipated and undesirable consequences.


This was in NO WAY unanticipated. The credit card companies told this to Obama himself and met with Congress several times and they ALL said this is what they would be forced to do.

The don't care if Dys closes his account, you're probably doing them a favor. They raise rates on people like him because very few of them will actually close their account because like Dys, there is no financial impact to them; they didn't get a good credit score by being reactive regarding their finances. Additionally, when they raise rates on people who have a balance, they can point to Dys and say, "See we raised rates on everyone, even people with good credit." It's the perfect political cover, and a few closed accounts is well worth that PR.

hawkeye10
 
  0  
Reply Thu 26 Nov, 2009 07:23 pm
@maporsche,
Quote:
The don't care if you close your account, you're probably doing them a favor.


given the absolutely horrible state of the average families balance sheet, and the dim prospects for any improvement in the foreseeable future....you betcha...
0 Replies
 
LionTamerX
 
  1  
Reply Thu 26 Nov, 2009 07:35 pm
If you have a little time to kill, this is worth watching.

http://www.pbs.org/wgbh/pages/frontline/creditcards/view/
Green Witch
 
  2  
Reply Thu 26 Nov, 2009 08:20 pm
@LionTamerX,
Excellent suggestion, LionTamer. That program really does a great job of explaining who is doing what and why.

I would love for people to watch and come back to this thread with their thoughts about it.
LionTamerX
 
  1  
Reply Thu 26 Nov, 2009 09:02 pm
@Green Witch,
It really does put things in perspective.
0 Replies
 
dyslexia
 
  1  
Reply Thu 26 Nov, 2009 09:05 pm
@LionTamerX,
yes, very informative.
LionTamerX
 
  1  
Reply Thu 26 Nov, 2009 09:06 pm
@dyslexia,
Just to make things clear, I don't like you, and don't see why anyone in their right mind should.
ossobuco
 
  1  
Reply Thu 26 Nov, 2009 09:26 pm
@LionTamerX,
Glad to see LTX back in force, though I must let the air out of one tire of that old car you had (I forget now, but it was green) for the apparent but clearly faux diss on the Dys.

Come to Abq and visit and insult him in person!

On the credit card maneuvers, some folks will have to turn to bankruptcy - I'm thinking the companies are thinking they won't do that in large numbers.
What would Shakespeare say?
epenthesis
 
  2  
Reply Thu 26 Nov, 2009 09:36 pm
@LionTamerX,
Quote:
I don't like you


whats not to like about dyshlyxckers

i'd keep the card as long as theres no annual fee

tell your good lady to protest by not using it

and totally ditch the idea of ever letting anyone use your debit or credit card

tell'er to go get'er own money

can i lend you a zac now that ive taken a lenda ya
ossobuco
 
  1  
Reply Thu 26 Nov, 2009 09:39 pm
@epenthesis,
Foo.
tsarstepan
 
  1  
Reply Thu 26 Nov, 2009 09:50 pm
@ossobuco,
Meep?
0 Replies
 
mushypancakes
 
  1  
Reply Thu 26 Nov, 2009 09:51 pm

Citi is rather crooked, ain't it?

One of those rotten from the inside jobs.

 

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