Consumer Complaints: Bank of America raising interest rate because they want to
Filed under: Banks, Cards, Consumer Complaints
We've all heard the stories of credit card companies suddenly deciding to raise your interest rate. If you've made a late payment or gone over your limit, the credit card agreement allows them to immediately raise your rate. And there are other lesser-known reasons for raising your interest rate. Now it's become more common for credit card companies to have a clause in your agreement that allows them to raise your interest rate if your credit score decreases or if you have a late payment to a different credit card company.One WalletPop reader wrote to me with this note about her increased interest rate:
I am writing because the Bank of America, where I have 5 or 6 different accounts, all in good standing, called me to tell me that my small business credit card finance rate was going to be increased to 23.99%. Not because I was ever late on a payment. Not because I went over my limit. Not even because I wasn't paying the minimum payment (I always pay more than the minimum payment). Nope. It was because I wasn't paying my balance down "fast enough".
I am small business owner, and only have the one business credit card. I asked the representative what rationale they employed to come to the conclusion that if they raise my finance rate, I will pay off this card faster. That is not even logical.
I'm glad to know that others like me have been scammed by the arbitrary practices of Banks and Congress is looking into it. HR 5244 address unfair credit card practices, and I hope everyone contacts their representatives to tell them to get on board and co-sponsor this thing and make them accountable.
This economy is so bad, my husband's overtime has dried up going on a year now, my clientele has shrunk due to the credit crunch and very limited disposable income.
I don't deny that this is completely legal under the credit card agreements. It's just a shame that when a consumer is in a position where they have a greater need for the credit, and appear to have a good history with the company, their interest rate is raised.
Do you think that credit card companies think long-term when they do these things? Do you think that eventually consumers will become wise to what Bank of America does and refuse to do business with them? I hope so. consumers need to speak by taking their business where they're appreciated and treated well.
Have you been cheated, scammed, or otherwise disappointed by a company? WalletPop wants your real life consumer complaints and scam stories Email us with your story...
Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.
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Reader Comments (Page 1 of 1)
6-10-2008 @ 11:30PM
JudyGee said...
These are precisely the abuses that existed before FDR organized the government to protect consumers, workers, the poor, all our citizens. We need a return desperately to a regulated environment, free from the influence of the banks and lenders, and cronyism. We can legislate away this usury, the intrusion into our personal lives, the FICO "scores", the way in which our information is available and used (even to get a job). email your senator, your congressperson and make sure they know the ace you hold is your vote for or against their political career. They like that free 100% medical coverage they gave themselves too much to give it up.
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6-16-2008 @ 8:49PM
Debbie March said...
I suggest you find a credit union to do your business with if at all possible. They are a "not for profit" financial institution unlike a "bank" with all the same type of insurance and protection on all of your accounts.
Reply
8-23-2008 @ 8:28PM
Emma A said...
Last year I had a credit card company once up my interest rate. I called them to find out why--had never been late, wrote a bad check and paid at least if not more on the min. balance due.
Their response to me was we, pulled your credit report and based on that, we upped your rate.
I told them I was going to close my account and they were losing a good paying, honest, on time customer. They did not care so the following month, the account was paid in full and account was closed.
A few months later they called to offer me a card, told them no and the reason why. They offered no interest for 24 month, still told them no and stated once again why.
Their loss.
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8-23-2008 @ 8:31PM
Emma A said...
oops---it should read
have never been late, have never written a bad check, .....
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11-02-2008 @ 7:40PM
John said...
This is exactly why the economy is in the mess it is. You aren't paying your debt down fast enough... The bank then raises your interest rate not because they think this will encourage you to pay it off faster but because they have looked at statistics and know you probably can't pay it off faster. This then locks in more income for them that they can look forward to for quite some time because not it will take you even longer to pay it off due to the increased fees. God Bless America and the greedy American way.... NOT!
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11-12-2008 @ 12:05PM
Kelly said...
Don't close your account at BOA, pay it off and let them continue to have to send you statements with a zero balance. If you close your account, it is reflected on your credit report usually in an unfavorable way. Let BOA spend the money to mail all of it's customers who refuse to use their card and fall for their horrible business practices. Way to be greedy, BOA. I'd be ashamed to represent BOA.
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