Chase Credit Card Nightmare

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I'm in a lot of trouble and I'm not sure how to resolve the issue. If anyone has any suggestions, please let me know.

I accidentally forgot to make a payment on my Chase visa card when I misplaced the bill and ended up finding it about a week after the payment was due.

I immediately went online to make my minimum payment of $145, but I was in for an incredible shock. My minimum credit card payment all of a sudden was $663.56.

I immediately called Chase and they explained that because my payment was late, my interest rate went from 8.99% to 29.99%. They also added in the finance charges, which came to almost $200, plus a late fee of $39, and added the payment I just missed plus next month's payment to what was due.

When I explained that it was a small mistake on my part, that I had religiously paid my bill on time for years and that it wouldn't happen again, she gave me no sympathy. She said there's nothing she can do and that I should make all my payments on time for the next 6 - 12. If I do that, then maybe they will lower my interest rate, but there is no guarantee.

I can't afford a 29.99% interest rate on a $8000 credit line. What can I do to get my prior interest rate back?

[disneysteve]

You should call back and ask to speak to a supervisor. Point out that you have always paid on time and request that they waive the late fee and ask if they can reduce the interest rate.

If they refuse to lower the rate, get yourself a new card and transfer the balance.

Just another example of why you should pay your bill in full every month.

[boosami]

If the supervisor you talk to refuses as well, write them a formal letter and threaten to transfer your balance if they do not lower the rate.

[arthurb999]

Just transfer your balance and move on...

[GREENBACK]

My god They're desperate. I have a Chase account with zero balance thats rarely used. Though this doesn't affect me I'm thinking of cancelling the account on principle. These are loan shark tactics. I occasionally miss a payment due to a something unexpected like travelling on buisness. If the company tried this on me I would definitely transfer away from them and let them know in no uncertain terms that I was no longer a customer.

[julee_m]

I ALways pay on time and yet yesterday I got a notice that minimum payments will now be 5% of the balance and that they can close my account at any time for any reason. After receiving the "skip this month's payment" last month. I have multiple Chase cards all in good standing. Do NOT trust this company to use common sense or to treat you fairly. I wish I didn't have so much of my debt with Chase. I can't roll all of it over. Glad I am no longer unemployed but I think I'm in deep trouble. Once I dig myself out, I will definitely never use this company again.

[boosami]

Originally Posted by julee_m

I ALways pay on time and yet yesterday I got a notice that minimum payments will now be 5% of the balance and that they can close my account at any time for any reason.

Wow, in a world used to 1% and 2% minimum payments that's a huge shocker! My girlfriend has a big balance on a Chase card and she is going to be beyond pissed when she gets this letter... Now I don't know if I should warn her ahead of time or just play dumb.

Can you close your account to avoid the change in terms much like you can with an interest rate hike? Do you have your card on a promo rate, or is it a standard rate card?

[happygirl]

I agree with DisneySteve.

[happygirl]

Originally Posted by julee_m

I ALways pay on time and yet yesterday I got a notice that minimum payments will now be 5% of the balance and that they can close my account at any time for any reason. After receiving the "skip this month's payment" last month. I have multiple Chase cards all in good standing. Do NOT trust this company to use common sense or to treat you fairly. I wish I didn't have so much of my debt with Chase. I can't roll all of it over. Glad I am no longer unemployed but I think I'm in deep trouble. Once I dig myself out, I will definitely never use this company again.

I read something about this. Apparently this is a decision made by congress and ALL credit cards will be doing this. Chase is just ahead of the game. They will also have to tell you in the statement how long it will take to pay off the debt at that rate.

Personally, I think as a society we should work towards getting rid of credit cards that don't require the user to pay in full at the end of the month anyway. I'm probably in the minority though.

[irmanator]

Originally Posted by happygirl

I read something about this. Apparently this is a decision made by congress and ALL credit cards will be doing this. Chase is just ahead of the game. They will also have to tell you in the statement how long it will take to pay off the debt at that rate.

Personally, I think as a society we should work towards getting rid of credit cards that don't require the user to pay in full at the end of the month anyway. I'm probably in the minority though.

when do they have to start this?

[boosami]

Originally Posted by happygirl

Personally, I think as a society we should work towards getting rid of credit cards that don't require the user to pay in full at the end of the month anyway. I'm probably in the minority though.

If we got rid of credit cards, people would just find another way to carry a balance--unsecured loans, paying in installments, loan sharks... There are a few people out there that can handle revolving debt responsibly, though. It's not credit cards that need changing, it's the mindset of the consumer that needs to change.

[boosami]

Originally Posted by boosami

Can you close your account to avoid the change in terms much like you can with an interest rate hike? Do you have your card on a promo rate, or is it a standard rate card?

By the way, I heard Chase was raising the minimum payment to 5% with a $10/month fee only for promotional rate balances. You can't opt out, but you can typically call and ask for a free transfer to a standard rate APR. You'll have to pay more interest, but it's the best option if you can't handle the more-than-doubled minimum payments. Non-promo cards should not see the change.

[happygirl]

Originally Posted by irmanator

when do they have to start this?

I went back to check my sources after you asked this and I think I'm mistaken. Apparently the part about having to post information about interest rates and how long it will take to pay back based on the minimum payment on your statement is correct. However, although my source was another forum which I normally consider fairly reliable, I can't find anything on the web about congress requiring minimum payments to go up. I did find one article on Chase specifically raising their minimums. It indicated other credit cards may follow suit but didn't give specific information.

There is a new credit card revision law, but overall it seems (in my opinion) to favor overwhelmed consumers rather than the lenders, so that could be a good thing for many who overborrowed.

I'm so sorry if I caused anyone to panic unnecessarily!

[julee_m]

I think tactics like increasing the minimum payment from 2% to 5% are going to cause a lot of pain for consumers who are just barely making ends meet. Where are they going to get the extra money? More foreclosures coming! I am pissed, in part, because they solicited these balance transfers at a certain rate and with defined terms - I didn't solicit them. I can tell that they are about to close the cards and demand immediate payment of the entire balance. I paid a balance transfer fee to them in order to borrow at defined terms and they are changing their rules. And I am one of their best customers with a very high credit score. Once the cards are closed my credit line will also decrease and my FICO score will plummet. Yes, in a perfect world we would all pay our credit card balances off each month. But with an effective unemployment rate of nearly 25% (if you count the people who are underemployed or fallen off the unemployment rolls), credit card company tactics like these will just prolong the pain for many. In the last decent job I had, the company closed. I have been working part-time at low wages and now have a full time job on top of that. But I'm not sure I can keep afloat.

[boosami]

Originally Posted by julee_m

I am pissed, in part, because they solicited these balance transfers at a certain rate and with defined terms - I didn't solicit them. I can tell that they are about to close the cards and demand immediate payment of the entire balance. I paid a balance transfer fee to them in order to borrow at defined terms and they are changing their rules.

Unstandably. But you should know the credit card companies are pulling moves like this in part because of the change in credit card law (CARD Act) taking effect by February 2010. Some companies will be trying to get higher rates and terms locked in before the law goes into effect and they have more difficulty in changing terms and squeezing money out of consumers.

A couple big things the CARD Act changes:

• No more universal default and arbitrary interest rate increases. Also no interest rate increases in the first year of a contract
• 45 days advance notice of an increase in interest rate or other change to terms (I think currently it's 15)
• Increases in interest rate do not affect the existing balance, only future transactions
• Statements must be sent 21 days in advance of the due date (instead of the current 14 days I think)
• Payments above the minimum will go towards the highest interest rate balance, rather than the lowest.
• No more charging fees for payment (e.g. extra charge for payment by phone rather than by mail)

[julee_m]

Yes, I know...some changes will indeed benefit consumers. But I understand that grace periods may no longer be used - interest starts getting charged immediately. Also cards will probably have fees. And before the changes hit they will squeeze us all they can. And some people who are struggling right now may well default, and that won't help consumers OR credit card companies. The squeezing will prolong the recession/depression plus they will lose formerly good customers.

[red92s]

Originally Posted by julee_m

Yes, I know...some changes will indeed benefit consumers. But I understand that grace periods may no longer be used - interest starts getting charged immediately. Also cards will probably have fees. And before the changes hit they will squeeze us all they can. And some people who are struggling right now may well default, and that won't help consumers OR credit card companies. The squeezing will prolong the recession/depression plus they will lose formerly good customers.

They are publicly-traded, for-profit corporations. They are interested in increasing shareholder value above being "nice" or "helping" their consumers. The sooner you come to the realization that credit companies do not exist to help you or make your life easier, the better.

[creditcardfree]

OP, this happened to my good friend, too. She was one day late. She called and was told the same thing, but she didn't give in. She told them about her payment history, ect and stayed on the phone over half an hour while the agent was able to finally get the rate lowered back down and have the interest charges waived.

Call again, try another agent and be proactive. If all else fails, look to transfer the balance. You might mentioned this in the call too!

Good luck. Let us know how it turns out.

[julee_m]

Yes, we all are well-aware they are for-profit. But they are shooting themselves in the foot with sneaky and unfair tactics that other businesses wouldn't try - because they will lose good customers and increase defaults. They are hurting themselves as well as their customers. We will take our business elsewhere.
Thank you all for the info, all, but please don't assume that I am stupid. This website and many others and books are great resources and I appreciate them. To all those being gouged I wish you luck.

[happygirl]

Julee, I'm not sure what you mean by being gouged. I could be wrong, but I'm pretty sure when you sign up for a CC it says somewhere in the agreement that they can raise the rate if x,y,z happens. I haven't gotten a new CC in 15+ years though so perhaps I'm mistaken.

Ultimately, when you use a CC you are essentially borrowing money from the company under agreed upon terms. I think it is a matter of personal responsibility in most cases. I know this is a rather simplistic view and it may not be pleasant, but that's how I see it.