At a time when many consumers need 0% balance transfers most, credit card companies are making these offers increasingly difficult to obtain.  Eighteen months ago, it was possible to get a 0% APR on balance transfers and pay no balance transfer fees.  Today, all major credit card companies charge at least a 3% balance transfer fee while Bank of America and Chase have raised their fees to 4% and 5% respectively.

As the fees associated with balance transfers increase, the average length of balance transfer offers appears to be steadily decreasing.  Just a few months ago, nearly every major credit card company offered 0% balance transfers that lasted one year.  Today, more and more companies are reducing the length of these offers to a mere 6 months.  Some companies, including Discover, have stated they plan to curtail balance transfers by as much as 75%.  Other companies, such as Chase, are reserving the right to decline balance transfer transactions, even to consumers with available credit. Continue Reading »

We’ve received a number of complaints from consumers who recently learned that their monthly credit card payments have been increased from 2% to 5% – a whopping 150%.  Most of the complaints we’ve heard come from consumers with fixed for life interest rates that are in the low single digits.  And most of the people we have heard from have simply had no luck getting their monthly payments reduced.

The raising of minimum payments by Chase couldn’t have come at a worse time for those affected.  Many have seen minimum payments increase by hundreds of dollars, leaving them with mortgage sized credit card payments.  Unfortunately, these consumers are left with very few options, as many companies have made it difficult to obtain 0% balance transfers.  Additionally, many people consolidated large amounts of debt onto these low rate cards, expecting to pay them off over a long term period of time.

Given both the decline in 0% balance transfer offers and the large balances many of these Chase customers carry, there truly are very few good options available.  (And taking a second mortgage surely isn’t one of them!)

However, I located on credit card that still offers a 2.9% fixed APR for life on balance transfers offered by the Pentagon Federal Credit Union.  This seems to be the only credit card providing such deals, and may be a good option for consumers who are being pushed to the brink by Chase.  However, this card is only available to certain military or government employees.

Here’s a link to their website:  https://www.penfed.org/productsAndRates/creditcards/overview.asp

Lastly, if you have had success with this credit card or in getting your monthly minimum payment reduced, please share your experience so others can benefit.  This unfortunate decision has really put a lot of people in very tough financial positions.  Any help you can offer would surely be appreciated.

A year ago today, a very high balance transfer fee was 3% with no maximum limit.  Many companies offered no fee balance transfers while most charged a 3% balance transfer fee with a $75 maximum.  The days of low and no fee balance transfers are long gone now, and Bank of America recently raised balance transfer fees to 4%.  Chase, perhaps wanting to one up the competition, recently sent notices informing consumers that Chase balance transfer fees will be raised to 5% in August. Continue Reading »

During their quarterly earnings call Thursday, Discover stated that they will seek to reduce balance transfers by 75%.  In other words, Discover no longer wants to loan money to consumers with credit card debt at low rates.  Over the past twelve months, Discover has sharply reduced the length of 0% offers for balance transfers and purchases from the previous industry standard of 1 year to around 6 months. Continue Reading »

Credit card companies have been cutting credit limits for the past six months.  For most, credit limit cuts come as a complete surprise and cause substantial issues.  One recent visitor who had her credit limit cut found out when a cash advance check mailed to her from her credit card company bounced.  A second was given two reasons that seemed to be picked out of a hat:  payments were low compared to balance owed and  she had “no mortgage loans.”

According the latter credit limit victim, she paid her bill monthly.  So reason one was irrelevant.  And a mortgage?  This person is a graduate student and didn’t plan on taking on a mortgage anytime soon.  And besides, since when did owning a home become a pre-requisite for having a credit card?  Seriously, credit card companies really are picking arbitrary reasons out of hats. Continue Reading »

Low rate balance transfer checks and their evil twins – cash advance checks – are often wolves cloaked in sheep’s clothing.  Despite the credit crunch, these checks are still showing up in mailboxes frequently, offering consumers low or 0% rates for three months to a year.  However, balance transfer checks and cash advance checks pose a number of issues for consumers that can prove quite costly.  This, of course, is the reason banks send them to us.

What brought these nasty credit card tools to my attention today was a horror story posted by a recent visitor.  She used a 0% cash advance check to pay down some high interest bills.  Unfortunately, the bank that mailed her the cash advance check decided to lower her credit limit before the check cleared.  This, in turn, caused her to bounce checks to two credit card companies and two utility companies, which will cause her interest rates to increase, cost her hundreds in bank fees, and may potentially damage her credit score. Continue Reading »

A year ago, credit card companies doles out generous credit limits along with generous 0% APR deals for balance transfers.  Today, credit card companies are slicing credit limits to new and current account holders and dramatically reducing the length of 0% balance transfer deals.  This poses significant problems for consumers who have grown accustomed to $10,000 and even $25,000 credit limits for balance transfers. Continue Reading »