Apparently, a low fixed APR for life isn’t entirely as low, fixed or long lasting as the description may lead one to believe.  Recently, Chase has been adding $10 monthly service charges to credit card accounts with low interest rates and large balances that are more than two years old.

This new fee, which is added to the higher, variable APR, is only the beginning.  More strikingly, Chase has raised the monthly minimum payment on many cardholders with low rates from 2% to 5%.  This move, much more so than the $10 fees, can mean the difference between keeping current with monthly payments and falling behind.  In fact, it is downright cruel to many creditworthy people struggling to get out of debt the honest way.

Just how dramatic this increase in monthly payments is best exemplified by a person with a $10,000 balance.  At 2%, the monthly payment on the card is a reasonable $200.  However, when that payment is bumbed to 5%, the payment balloons to $500 a month.  For many, that $300 monthly increase could be the difference between getting by and giving up. For those who can’t afford to keep up with the payments, a balance transfer may be the best option.

In the short run, Chase risks pushing honest, hardworking Americans who would never consider defaulting on their payments into a corner.  In the long run, Chase risks chasing away credit worthy customers and damaging their brand.  Who would want a Chase credit card if they were aware that Chase clearly reserves the right to push customers to the brink?

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