Credit Tips: Credit Card Rate Increase Help Tips

Posted On: January 1, 2006

Author: linda
Posted: Wed Jul 21, 2004 3:01 pm
Post subject: Credit Card Rate Increase Help Tips

10/6/2001 8:48 am CDT

I’m looking for some assistance in what I can do (if anything) about Citibank increasing my interest rate to 18.74% due to balances on other cards. I saw in the reviews that this has happened to others, and one gentleman said he filed an FTC complaint. I had been with Citibank for 15 years (until last night) and did not have any late payments. I missed the fine print on one of my statements telling me there was a change in terms coming, so I didn’t have the opportunity to close the account before the interest rate was increased. Any advice will be appreciated. I called customer “service” and they were unable to help.

Author: Ira Stoller
Posted: Wed Jul 21, 2004 3:02 pm
Post subject: Credit Card Rate Increase Help Tips

10/6/2001 4:14 pm CDT

First of all, how much of a balance are you carrying? If you pay off the entire amount each month, the rate is meaningless since it never applies. If your credit is good and you’re carrying a balance, you might want to apply for another card that will give you a lower interest rate on transfered balances. Then simply transfer the balance to the new card and you’re done. You can find plenty of them listed right here on this board.

You have to be the one to say how much of an impact this higher rate is going to have on you. For instance, if it’s going to increase your finance charges by less than $5.00 a month, does it really pay to fuss around getting new cards, transfering balances, etc.? On the other hand, if it’s going to increase your finance charges by $20.00, $30.00 or more, that’s a dirrerent ball game. Only you can answer these questions.

Author: linda
Posted: Wed Jul 21, 2004 3:02 pm
Post subject: Credit Card Rate Increase Help Tips

10/6/2001 9:55 pm CDT

Thank you for your reply. I have a very large balance on this card, and the 6% increase will mean much larger monthly payments in order to pay it off. I think it is very unfair for a company to increase the rate due to balances on other cards. I’m looking for what recourse I may have to get Citibank to reduce the rate back to where it had been. The people at customer service say they have no power to consider individual circumstances, even though I just paid off $7500 in other credit card bills. Apparently the 15 years of prompt payment means nothing, and they have put me into a high risk category. I’m working hard to reduce debt, and this just set me back a bit, since I was planning on using this card exclusively and getting rid of the others. It also had the benefit of Upromise for additional college savings for my son, so I’m losing out on that potential additional $300 a year towards his savings. I don’t understand how a company can do this in the middle of the Fed Reserve reducing the interest rate, and prime now being at 6%.