2009 has surely been a less than stellar year for many of us. Unfortunately, the difficulties many of us are going through have been made significantly worse by our not so friendly credit card companies. During the first half of 2009, Smart Balance Transfers received ten times more credit card complaints than we have in the past two years. To make matters worse, most of the credit card complaints we’ve received came from people who had really done nothing wrong. In the past, a majority of complaints came from consumers who had made mistakes, such as missing payments or failing to understand elementary fine print. Such is not the case in 2009.
In 2009, the worst credit card complaints have come from people who literally did nothing to deserve ludicrous interest rate increases, absurd payment increases, and drastic credit limit decreases. So strap yourself down and take a moment to absorb some of the most horrendous credit card practices in the history of modern finance.
Credit Card Complaint 1: Anytime, Any Reason Interest Rate Increase:
“My HSBC direct rewards card advertised a 16% interest on cash advances. I had the card three years, and never used this. Finally, last month I took a cash advance, my first, and they raised my cash advance interest rate to 58%! When I sent an e-mail asking if this was an error, I was told that my agreement stated, (in so many words), that they could raise my interest any amount at any time for any reason, and that was that. I have never been late, never missed a payment, and almost always paid more than the amount owed. Needless to say, I will be transferring my balance to another card, and destroying this one.” -Cheryl
Comments: This may be the highest interest rate ever charged. Ever. And this includes loan sharks.
Credit Card Complaint 2: Interest Rate Doubling, Credit Line Dwindling:
“I have had a Direct Merchants Bank MC for over 7 years and currently carry a balance of less than $1000. Effective in January the interest rate doubled to 29%. The card limit was $4400 but I just rcvd a letter from HSBC who took over the account 2 yrs ago and it states they are reducing my credit limit to $1110. The letter reads “We recently completed a loss mitigation review on our Direct Merchants Bank MC accounts. As a result of the class of accounts into which your account fell, the credit limit has been reduced to $1110.” I have never made a late payment and pay more than the minimum. This is unfair and a credit reduction of over $3000 will certainly affect my credit score! What rights do I have?? None!” – Chris
Comments: Double the interest rate and cut the credit limit in half. Oh, we really appreciate your business!
Credit Card Complaint 3: We Know Times are Tough, So Give Us All Your Money:
“I am one of the Chase CC customers that is affected by their 5% minimum payment increase. I have been with them for more than 5 years and have not made any single late payment. Their practice is outrageous! It is useless to contact them. I have called and asked nicely about alternatives, and was told nothing can be done, except I have 30 days to look for another institution to transfer my account. Two years ago Chase called me to offer this fixed rate 5.99% option to combine my bilsl in one place. I carry pretty large balance and my current payment is $350, but it will soon be $875.” – Chris
Comments: A $350 monthly payment can be a big strain on most people. So, during a time of financial stress, we’re gonna increase that payment to $875. Hope this isn’t too big of an inconvenience. You should be able to find a healthy, affordable way to feed yourself off the dollar menu-they have salads now!
Final Thoughts: Choosing three credit card complaints out of the hundreds received by Smart Balance Transfers wasn’t particularly easy. In fact, there are so many headline worthy complaints, we’ll need to post a lot more than three to paint an accurate picture of just how poorly credit card companies have been treating customers.
In the past, when one credit card company wronged a consumer, it was easy to transfer credit card balances to a different company and enjoy a 0% interest rate. Today, getting approved for low rate and 0% credit cards is becoming increasingly difficult. Consequently, many consumers are stuck with credit card companies that seem to show no regard for their customers. And, despite new credit card laws, things continue to get worse.
If you have a moment and a credit card complaint, feel free to share it with us anonymously. Even better, if you found a solution to a credit card problem that worked, your comments could help out the millions of Americans who are now paying a heavy price for the mistakes our banks made during the past five years.