Leonard Washington Posted December 18, 2008 Share Posted December 18, 2008 (CNN) -- It arrived in Rich Stevens' mailbox a few weeks ago: the notice that Citibank had "rate-jacked" the Visa cards belonging to him and his wife.Some credit card holders have seen their interest rates go up dramatically, a practice called "rate-jacking." "In my case, from 9.5 percent to 16.99," the 54-year-old nurse from the Long Island hamlet of Merrick, New York, told CNN. And his wife's rate zoomed from 7.95 percent to 16.99 percent, he said. Stevens said he did not know why the rates had soared; his credit rating is great. But, like thousands of other credit card customers around the nation, he has been notified his rate is skyrocketing. "It almost borders on loan-sharking, from my perspective," he said. In the blogosphere, writers are livid at the instant rate hikes -- called "rate-jacking." Citigroup seems to be the target of most bloggers' venom -- partly because Citigroup issues so many credit cards and partly because Citi began sending the notices at about the same time it was getting a $20 billion, taxpayer-financed government bailout. No one at Citigroup would talk on camera to CNN about the matter. Instead, the company issued a written statement, which said: "To continue funding in this difficult credit and funding environment, Citi is repricing a group of customers." Citi told CNN that anyone unhappy with the new rates can opt out and continue paying the lower interest, but they must close their account when their card expires. It's all in the fine print. Rep. Carolyn Maloney, D-New York, said she is sick of the fine print. She agreed that credit card companies get away with whatever they want, as long at they put their desires into the fine print. "They have this provision that says they can raise the rate -- any time, any reason," she said. In September, Maloney got the House to pass by an overwhelming margin of 200 votes the "credit card holders' bill of rights," which would have stopped rate-jacking and the imposition of other fees by banks. Citibank raised my rates as well from 5-16.99! :mad: Luckily I don't have a balance. Way to pass on the federal funding you receive to keep consumer credit flowing. :doh: Link to comment Share on other sites More sharing options...
PleaseBlitz Posted December 18, 2008 Share Posted December 18, 2008 This happened to me a while back. Chevy Chase bank jacked my rate (to 24.99% :yikes: ) after i missed one payment because i moved and didnt get the statement until it was too late. I paid it off 3 months later. On the memo line of each check i wrote little notes like "Chevy Chase Rape" and "I hope your bank fails." Link to comment Share on other sites More sharing options...
Kosher Ham Posted December 18, 2008 Share Posted December 18, 2008 Funny you mention this. I got a notice of increase from a bank just yesterday. Sad thing for them, I haven't even used the card in 5 years. Way to motivate me to take on some debt. Idiots. Cash is King and that has been my (borrowed) motto for years now. Link to comment Share on other sites More sharing options...
sacase Posted December 18, 2008 Share Posted December 18, 2008 WEll once consumers start closing cards, I think they will see the light. If I was a CC company I would keep rates low to attrack business from other companies. "Credit rates get jacked up? Come to XXXX where we offer and keep rates low." Link to comment Share on other sites More sharing options...
Bang Posted December 18, 2008 Share Posted December 18, 2008 Is there no end to the predatory greed that our financial institutions have embraced as "business as usual"? ~Bang Link to comment Share on other sites More sharing options...
PiLfan Posted December 18, 2008 Share Posted December 18, 2008 i never pay attention to the rates...i always pay off every month and never leave a balance. couldn't even tell you what the rates are for my credit cards. sometimes i get the question, "why not just use a debit card?"...well, i hate having to constantly keep track of the balance in my credit union acct after every purchase (i'm a cpa, so i'm kinda anal about always keeping the balance straight), and with a cc, i just charge and forget it until i get my on-line stmt, pay it, done. Link to comment Share on other sites More sharing options...
Kosher Ham Posted December 18, 2008 Share Posted December 18, 2008 i never pay attention to the rates...i always pay off every month and never leave a balance. couldn't even tell you what the rates are for my credit cards.sometimes i get the question, "why not just use a debit card?"...well, i hate having to constantly keep track of the balance in my credit union acct after every purchase (i'm a cpa, so i'm kinda anal about always keeping the balance straight), and with a cc, i just charge and forget it until i get my on-line stmt, pay it, done. But that is why I use AMEX. The random other cards and debit cards are useless to me. Link to comment Share on other sites More sharing options...
PiLfan Posted December 18, 2008 Share Posted December 18, 2008 But that is why I use AMEX. The random other cards and debit cards are useless to me. i know...i had an AMEX, but i mainly use a card now that offers better points/miles for each purchase. Link to comment Share on other sites More sharing options...
Slacky McSlackAss Posted December 18, 2008 Share Posted December 18, 2008 My parents taught me early to treat my credit card like a debit card. If you dont have the money to pay for it at the end of the month, then DONT BUY IT. Its that simple. Link to comment Share on other sites More sharing options...
SkinInsite Posted December 18, 2008 Share Posted December 18, 2008 Straight cash homey! Link to comment Share on other sites More sharing options...
PiLfan Posted December 18, 2008 Share Posted December 18, 2008 My parents taught me early to treat my credit card like a debit card. If you dont have the money to pay for it at the end of the month, then DONT BUY IT. Its that simple. definitely the motto to live by when it comes to credit cards. Link to comment Share on other sites More sharing options...
Burgold Posted December 18, 2008 Share Posted December 18, 2008 Is there no end to the predatory greed that our financial institutions have embraced as "business as usual"?~Bang Exactly what I was thinking. From the bailout to the rate changes, the free market institutions haven't been thumbing their nose at the government. It's been given us the finger. Link to comment Share on other sites More sharing options...
TrumanB Posted December 18, 2008 Share Posted December 18, 2008 Two points: 1. These a-holes shouldn't have gotten ANY type of bailout. 2. There doesn't need to be any government regulation on capping credit card interest rates. If a customer doesn't like a rate hike, close the account and find a lower rate card. There's plenty of credit unions out there that actually cater to their customers and offer reasonable rates. For once, I'd like to see the free marketplace actually work like it was intended to work. No more bailouts. No more stupid regulations. Link to comment Share on other sites More sharing options...
Old Bay Posted December 18, 2008 Share Posted December 18, 2008 I barely use the card, but I'm going to opt out. Way to repay your loyal customers. Link to comment Share on other sites More sharing options...
Kosher Ham Posted December 18, 2008 Share Posted December 18, 2008 Two points:1. These a-holes shouldn't have gotten ANY type of bailout. 2. There doesn't need to be any government regulation on capping credit card interest rates. If a customer doesn't like a rate hike, close the account and find a lower rate card. There's plenty of credit unions out there that actually cater to their customers and offer reasonable rates. For once, I'd like to see the free marketplace actually work like it was intended to work. No more bailouts. No more stupid regulations. I agree with most of your post. The bolded part though is where I have a question. Doesn't closing and opening new accounts mess up your credit ? I am fortunate in the fact that I dont really have any credit card debt, car debt or even house debt. But if I needed it (credit) I would like it to be there and be good. Link to comment Share on other sites More sharing options...
PleaseBlitz Posted December 18, 2008 Share Posted December 18, 2008 Two points:1. These a-holes shouldn't have gotten ANY type of bailout. 2. There doesn't need to be any government regulation on capping credit card interest rates. If a customer doesn't like a rate hike, close the account and find a lower rate card. There's plenty of credit unions out there that actually cater to their customers and offer reasonable rates. For once, I'd like to see the free marketplace actually work like it was intended to work. No more bailouts. No more stupid regulations. The whole reason they do this is because most people that have it happen to them dont have the cash to pay off the cards, so there absolutely needs to be usury laws so banks cant rape them even worse. I know i know, if they cant pay it off, they shouldnt spend it. Not everyone is as super-smart as you are. Link to comment Share on other sites More sharing options...
WVUforREDSKINS Posted December 18, 2008 Share Posted December 18, 2008 My parents taught me early to treat my credit card like a debit card. If you dont have the money to pay for it at the end of the month, then DONT BUY IT. Its that simple. This should be common sense to everyone. Oh, how America fails. I am about to join a credit union. Screw Chevy Chase. Link to comment Share on other sites More sharing options...
TrumanB Posted December 18, 2008 Share Posted December 18, 2008 I agree with most of your post. The bolded part though is where I have a question. Doesn't closing and opening new accounts mess up your credit ? I am fortunate in the fact that I dont really have any credit card debt, car debt or even house debt. But if I needed it (credit) I would like it to be there and be good. Good question. If you do a balance transfer to a new account, it's not like your increasing your debt. So, I wouldn't think it would have an affect. Maybe someone on this board in the credit industry could answer this. Link to comment Share on other sites More sharing options...
TrumanB Posted December 18, 2008 Share Posted December 18, 2008 The whole reason they do this is because most people that have it happen to them dont have the cash to pay off the cards, so there absolutely needs to be usury laws so banks cant rape them even worse.I know i know, if they cant pay it off, they shouldnt spend it. Not everyone is as super-smart as you are. "Citi told CNN that anyone unhappy with the new rates can opt out and continue paying the lower interest, but they must close their account when their card expires." Well, specific to what Citi is doing, you shouldn't have to pay off ALL of the debt since you can opt out of the rate increase and continue to pay down your debt at the older, lower interest rate. I guess you're screwed if you want to opt out but your card is about to expire. Link to comment Share on other sites More sharing options...
Zguy28 Posted December 18, 2008 Share Posted December 18, 2008 I don't use credit cards unless absolutely necessary such as for travel. This nation (as individual persons) have a big problem with debt. Link to comment Share on other sites More sharing options...
Slacky McSlackAss Posted December 18, 2008 Share Posted December 18, 2008 This should be common sense to everyone. Oh, how America fails.I am about to join a credit union. Screw Chevy Chase. I'd join a credit union but I love my Redskins debit and credit cards too much. Damn you Bank of America!!!! Link to comment Share on other sites More sharing options...
PleaseBlitz Posted December 18, 2008 Share Posted December 18, 2008 "Citi told CNN that anyone unhappy with the new rates can opt out and continue paying the lower interest, but they must close their account when their card expires."Well, specific to what Citi is doing, you shouldn't have to pay off ALL of the debt since you can opt out of the rate increase and continue to pay down your debt at the older, lower interest rate. I guess you're screwed if you want to opt out but your card is about to expire. There still needs to be usury laws. Is 24.99% not enough profit for a bank getting a $400 billion subsidy from the taxpayers? Link to comment Share on other sites More sharing options...
Chump Bailey Posted December 18, 2008 Share Posted December 18, 2008 Citibank raised my rates as well from 5-16.99! :mad: Luckily I don't have a balance.Way to pass on the federal funding you receive to keep consumer credit flowing. :doh: 5% to 16.99% ? That's insane... Geez - mine is going from 5% to 6%. Link to comment Share on other sites More sharing options...
PleaseBlitz Posted December 18, 2008 Share Posted December 18, 2008 5% to 16.99% ? That's insane...Geez - mine is going from 5% to 6%. Call them and tell them to **** off. Money is getting cheaper, not the other way around. Link to comment Share on other sites More sharing options...
Kosher Ham Posted December 18, 2008 Share Posted December 18, 2008 Good question. If you do a balance transfer to a new account, it's not like your increasing your debt. So, I wouldn't think it would have an affect. Maybe someone on this board in the credit industry could answer this. But increasing even your available credit, makes lenders second guess (as far as I know) potential loans. For example, They ran my credit when buying this house and asked me about the 8000 dollar due to AMEX. I explained it was Xmas time and that was well within my budget. I didn't need the loan, I paid cash, but they still do that type of crap anyways. Link to comment Share on other sites More sharing options...
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