Based on the unprecedented amount of feedback received by Smart Balance Transfers this year, I think its fair to say that a very large percent of credit cardholders have endured at least one interest rate increase, credit limit cut or account closure this year.  In fact, I wouldn’t be surprised if a majority of Americans were impacted this year.  The Credit Card Act, which gained steam early in the year and finally passed in the spring, was supposed to prevent the reckless and massive rate increases so many of us have experienced.  Unfortunately, it may have fueled the rate hike frenzy and a new push from Congress to implement new laws is clearly too little and much too late. Continue Reading »

If you want credit card horror stories, you can find them all over the Smart Balance Transfers blog.  Beginning last November, visitors started writing me with increasingly horrific tales of credit card companies gone wild.  Of all the stories I’ve heard, none have bothered me as much as the recent reports of interest rate increases by Citibank that have left what seems like millions of customers with two options:  close your credit card account or pay 29.99% interest.

Prior to the credit crunch, the majority of credit card complaints revolved around unfair penalties, most of which were clearly outlined in the terms and conditions of the affected party’s credit card contract.  During the credit crisis, the nature of these horror stories changed.  Rates were being sharply increased, credit limits were being cut, and accounts were being closed with no warning. Continue Reading »

Following an extended period of reduced introductory rates, 0% balance transfers for 12 months have become available.  However, these offers are scarce, as most credit card companies continue to offer 0% rates lasting around 6 months in advance of new credit card laws and record high consumers defaults.

A year ago, most balance transfer offers lasted 12 months, while some were good for as many as 15 months.  On top of that, many credit card companies offered fixed rates for life on balance transfers with interest rates as low as 2.9%.  The days of fixed for life balance transfers are most likely over.  During the past year, many customers who had fixed APR for life balance transfers were rudely notified that they would either have to pay 200% more every month or shift to a higher variable rate in order to maintain a lower monthly payment.

Given the high probability that low fixed balance transfer rates are unlikely to return in the near future, securing a 0% APR for 12 months on balance transfers and using that 0% period to pay down debt is clearly the best option for consumers looking to reduce debt and interest expenses.  On the average, a person with a 15% interest rate and a $10,000 credit card balance can save in excess of $1000 during 12 months with a 0% balance transfer.  With a 29.99% interest rate, such as those being forced on consumers by Citibank, the savings come to well over $2,000.

Hopefully, more credit card companies will bring back 0% offers that last more than 6 months.  Unfortunately, this is unlikely, as credit card companies continue to be very selective when reviewing credit card applications.

For more information on current 0% balance transfer offers, please see the credit card comparison section of Smart Balance Transfers by using the navigation on your left.

During the past years, I’ve heard more credit card horror stories than I care to remember.  The Smart Balance Transfers blog is littered with disheartening stories of consumers who’ve had fixed rates changed to variable rates, interest rates doubled (or tripled) and minimum monthly payments increased by 200%.  Many of these people were pushed to the brink of bankruptcy.  Others are simply being fleeced.  And now that Citi has decided to raise interest rates to 29.99% on tens of thousands of customers with good credit, I’m willing to resort to scare tactics to convince readers that there are 29.99 reasons to focus their efforts on paying off credit card debt as soon as possible. Continue Reading »

I just got a copy of the Citibank interest rate increase letter and, perhaps like many of you, am completely baffled.  Unfortunately, I’ve spent the past five years reviewing credit card terms and was hoping to find some definitive answers in this letter.  However, the terms Citi is proposing are as incomprehensible as its decision to raise rates on what I’ve learned from over 60 readers are very good customers with very good credit scores.

1.)  Traditional opt out notices require those who opt out to accept an immediate closure to their account.  You opt out, the card is closed, and that is it. Period.  In the letter I reviewed, it states that the cardholder can use the card until the expiration date on the card.  This wreaks of trickery and my fear is that consumers who opt out but use the card after the opt out date will see their rates increased to 29.99%. Continue Reading »

People can say what they will about the blogosphere, but one thing that gets proven true over and over again is that many blogs often beat the mainstream media to the punch by days, weeks, and even months.  Such is the case with a recent story that appeared on abcnews.com regarding balance transfers.

For about six months, our site has been writing about this issue and reading the article by Rich Blake leaves us wondering if he stopped by to learn about the subject before writing his own article.  In it, he points out the issues we have been hammering home since the beginning of spring, namely, 0% rate periods are on the decline, balance transfer fees are increasing, and more and more consumers are having difficulty getting approved for 0% deals. Continue Reading »

While many credit card companies have been reducing the length of 0% balance transfer offers and increasing balance transfer fees, good balance transfer deals still exist.  The problem, unfortunately, is getting approved.  A year ago, credit card companies were significantly more generous when it came time to extend credit lines.  Today, consumers with good credit may find themselves getting the cold shoulder when looking to transfer a balance.  Here are a few tips to help navigate today’s credit card landscape: Continue Reading »

While it isn’t time to start jumping up and down, one major credit card company rolled out a credit card that offers a 0% APR on balance transfers for 1 year.  This could be viewed as a positive sign that longer 0% periods are returning, although it is entirely possible that this is just a test that could be pulled from the market quickly.

This particular deal (you can view offer details here) comes with the new standard balance transfer fee-5%.  A year ago, paying a 5% balance transfer fee was unheard of.  However, at that time you could get a 0% APR for 15 months or a fixed APR for life at a 2.99% rate.  Clearly, things have changed. Continue Reading »

A few months ago, a visitor wrote to Smart Balance Transfers to tell us that a balance transfer check she received in the mail bounced when she tried to use it.  I had hoped this was an isolated issue, but a second visitor wrote in yesterday with a new balance transfercheck horror story.   Here’s what Rob had to say:

“I received some balance transfer checks from one of my Chase credit card accounts. I used the check to make a payment of $25,000k to my Bank of America credit card, to get a lower interest rate with Chase. When BOA went to cash the check to cover my payment, Chase DENIED the check. So I got hit with a $40 check returned fee. But to top that off, BOA bumped my entire balance to 19.9% instead of 10.9%. BOA said when I made the payment that my balance was cleared, but when the check was returned, they had to put the balance back on my card under “cash advance” now at 19.9%. They said this is “standard practice with all banks”. So I got screwed by Chase AND BOA. I have used those balance transfer offers many times in the past. Didn’t realize that they could decline payment on them. Guess I learned a valuable lesson.” http://www.smartbalancetransfers.com/blog/2009/08/credit-card-companies-cut-credit-limits-to-zero/#comment-6059 Continue Reading »

Credit card companies have become more and more selective about who they approve for balance transfers during the past year and many consumers that would have been approved instantly are now getting denied.  Many of these consumers very recently had scores in the low to mid 700’s, but suffered damage to their credit score by credit limit decreases or account closures forced by their credit card companies.  Because of this, it is more important than ever to check your credit report (you can view free credit report offers here) before applying online. Continue Reading »

Last spring, all the major credit card companies sent out significant numbers of opt out notices.  And the notices looked an awful lot like junk mail.  In fact, a shocking number of people wrote into Smart Balance Transfers to tell us how their interest rates were doubled, tripled, and in some cases, quadrupled.  Reports from visitors trickled off during the past few months, and I had hoped the rate increases tied to junk mail looking opt out notices had ended.  Unfortunately, it hasn’t. Continue Reading »