Discover Credit Card Interest Rate Hike

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Author: archive
Joined: 23 Jul 2004
Posts: 5007
Posted: Tue Jan 11, 2005 11:04 pm
Post subject: Discover promised12.9fixed,but switched to15 var.

Jody
Date: 9/4/2000 0:09 am CDT

Dear Madam or Sir,
My close friend who has good credit but alot of debt due to some unfortunate
circumstances, recently consoladated her debt into one card that was offering
a great intro rate of 2.99 % that would convert after 6 months to a 12.99 %
fixed. She transfered all her cards totalling $14,000 dollars over to
Discover Platinum. As her intro rate term neared it's end she was sent a
letter saying that they were changing her plan to a 15.99 % variable rate.
The itty bitty fine print said that if she did not agree with this, she was
to write a letter stating so. It then went on to say that if she did do
this...they would close her account and she would owe the balance immediately
! Totally unable to pay 14,000 dollars overnight she was forced to accept
this fraudilent practice from Discover. Please tell me that there is
"something" that she can do. P.S. I was the friend that encourage her to
consoladate with Discover. Please help. She is a good person, hard worker,
and doesn't deserve this decietful bs from Discover. What ever you can do, I
would so greatly appreciate. Thank you so much,

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Author: archive
Joined: 23 Jul 2004
Posts: 5007
Posted: Tue Jan 11, 2005 11:04 pm

Eugene Skorodinsky
Date: 9/4/2000 2:11 am CDT

Tell your friend to read the card agreement - if Discover reserves the right to raise the APR when the cardholder "defaults under any other credit card agreement", (s)he can (1) call Discover and ask to reverse this because the triggering event did not happen, (2) threaten to take legal action (read the entire agreement REALLY carefully), (3) transfer the balance away (this might be easier).

If the agreement says something like "We can raise your APR for any reason", Discover did nothing illegal. Your friend can still call and ask to lower the rate back, threatening to transfer the balance away and close the account. Most probably, it will be lowered only partially, if at all. Then consider transfering the balance away.

Eugene.

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Author: archive
Joined: 23 Jul 2004
Posts: 5007
Posted: Tue Jan 11, 2005 11:05 pm

Board Monitor - CA
Date: 9/8/2000 2:10 am CDT

Jody,

Thanks for your recent inquiry! Discover has a history of such practices. Earlier this year, they changed many of their "fixed rate cards" to variable rate cards and, in so doing, raised their rates significantly. Such changes have resulted in many, many complaints by Discover Card customers (search our message board for a sampling).

Anyway, I would talk with a manager and explain your situation and threaten to transfer the balance to another card. I would also state that you have posted your situation on our board and that the message will stay permanently on our site (you may want to also mention that our site gets well over 1,000,000 page views a month). This should hopefully generate some response (most card issuers don't like negative exposure). If not, I would try to apply asap for another card and transfer the balance. Visit our "Card Reports" section for a list of card that have attractive balance transfer offers.

Please consider writing a review on Discover by visiting our Card Holder Reviews section. Doing this will help others avoid the problems you have encountered.

Best Regards,
Curtis Arnold
CFCCT P.R. Director
http://www.cardratings.org

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