Chase, Bank of America moving to vari...

Chase, Bank of America moving to variable-rate credit cards

There are 22 comments on the Austin American Statesman story from Jul 11, 2009, titled Chase, Bank of America moving to variable-rate credit cards. In it, Austin American Statesman reports that:

Two of the biggest issuers in the nation, Bank of America Corp. and Chase, are switching some fixed-rate cards to variable rates to manage costs in light of the sweeping new reforms to the credit card industry.

Join the discussion below, or Read more at Austin American Statesman.

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I got swindled by BoA

Hayward, CA

#1 Jul 28, 2009
I took a large cash advance ($45K) in December of 2008 from BOA because they offered an intro rate of 0% and it would be applied to my fixed rate of 7.9% afterwards. Now they have gone and changed it and said there's nothing I can do and it's non-negotiable. The customer service reps were downright nasty, giving the same treatment as if I'd not made payment in 6 months. I've had this card since I became old enough to have one in 01/97 and have always paid them off and am never late with payment. This investment was the only thing, but the investment only makes sense at a fixed rate which is why I talked it through with them.
If they will relent and give me my fixed rate I will pay them in full per normal. If they just keep the historical advance at the agreed upon rate and set my new purchases at variable I will pay them in full. Both were offered and flatly rejected by them. Though I've not done it before, what's the worst that can happen if I tell them where to go and never pay it.
Customer service rep

Paris, TX

#2 Aug 3, 2009
You were asking a rep to do something that was impossible to do. We don't have the power to give you back a fixed rate no matter what you offer. Your variable rate was set to be the same as your fixed rate at issuance. The rates only go up if our cost to borrow goes up (prime raises). I.E. You are in the same boat as BOA now. We are making not one cent more profit from your account as we did before.
Swindled Also

Federal Way, WA

#3 Aug 4, 2009
5.84% to 17.86% last month. I too had a fixed rate card with no late payments. From $15 to $75 in interest how in the hell does a customer service rep think that BOA is not making anymore profit from before? I am sorry about the folks who are stuck and cant get out. I am not stuck and am getting out. What happens now is BOA is left with high risk accounts and right back where all the economic BS started in the first place. Why on Earth would you mess with the customers that are the heart and soul of your business is beyond me. Must have a MBA in Stupid!
BOA Is the Worst

Brooklyn, NY

#4 Aug 4, 2009
I'll be happy when they are the next bank to go under!

For no reason whatsoever they just decided one day a couple of weeks ago to cut my business credit line from $20K down to $4,900. I had a check already processing (and should have been paid already) when they sent me the notice. They didn't even give any notice, and they bounced the check (which caused a mortgage payment to bouce)!

I have excellent credit, have always paid my account on time, have had the LOC for 2 years, and am paying them a riduculous 11.24% on the line. I will be demanding my LOC to be restored, but this is the reason I closed my checking accounts with them a while ago!
Customer service rep

Paris, TX

#5 Aug 4, 2009
Swindled, and BOA is the worst, I'm going to tell you honestly that you are my favorite kind of customers to deal with. I hover with my finger over the close button when you call in just waiting for you to say the words so that I can close your card and get you off of my phone. You dont want help, you dont want advice, you dont want to face the fact that if we are cutting your credit lines or raising your APRs then its because of something you did.

BOA is the worst, if you want to know why we cut your line of credit, please reread your post. Unless I am mistaken, did you not just say that our cutting your credit line on your business card caused your mortgage check to bounce?

One, that tells me that you might possibly be using your business card for personal expenses. But the biggest thing that tells me is you were using one line of credit to pay another line of credit. Since you said it as if it was normal, I've got to assume that you see nothing wrong with that. That type of robbing Peter to pay Paul lifestyle makes you a risk. Sorry.

As far as demanding to get your line back, demand away. Its not going to happen. You fail to understand that there is simply no way to do it. I mean that. The option does not exist anywhere in the computer system. You can reapply for a higher line of credit, but the factors that decide that are the same factors that led to your cut in credit line. There is no override button.

The way to get that higher line back are to change the factors. Decrease your total debt, increase your income, improve your credit score etc.

Swindled Also, you seem to be failing to understand that while we do take into account your payment history with us to determine your APR, we also take into account your credit report, your debt, and your income. Any over the limits, and late fees, any extra debt with ANY creditor affects that.

If your apr went from 5.84 to 17.86 percent it was NOT the same thing as the first posters change. Yours was a risk based change. That means that something YOU did made you a risk to us. And by the raise, it was apparently something pretty significant. We can change your APR. But to be honest, I personally wouldn't until I had the next 6 month credit report in front of me and only then if I saw a significant positive change or if you had disputed an error with your credit bureau reporting and had negative incorrect information removed.

(On a personal note, If you are telling the reps that you are talking to that we have MBAs in stupid, I promise you that we will follow our guidelines to the letter, as will any other rep that sees the note in your file in big capital letters that you have been abusive. We can and have closed cards because customers are abusive and are completely within bank policy when we do it)
dstump2

Philadelphia, PA

#6 Aug 6, 2009
Bank of America is totally out of control. They've reduced my credit limit from 30,000 to 500.00. When asked for a supervisor, I was not allowed to speak to one. Their customer service reps are rude and arrogant. I run a small business and there was no bailout for me. They received an enormous bailout and now they are tightening the screws on good customers and choking off small business. I pay taxes that were used to bail out this bank but I had no say in it. I'm inclined to not pay their bills but then they'll just tack on 39.00 late fees and raise the interest rate to 30%.
Customer service rep

Shinnston, WV

#7 Aug 6, 2009
Actually, we aren't rude or arogant. We can be extremely blunt though, it saves time.

Once again, speaking to a manager would do no good. The only way to get your credit line back is by improving your financial situation. The mananger has no more power over it than we do. Also, as a rule managers will back reps 99.9 percent of the time. We have the same guidelines and if the Rep is following them there is no reason to go against them. There are few that DONT follow the guidelines, they tend to get weeded out very quickly. I'd have transfered you over to a manager if it was me, but it would have still been a waste of both of your time.

Once we explained to you how to get what you want over 3 times, we figure what you want is to complain/argue. Bluntness comes into play then.

While you are complaining about something only you can fix for 20 minutes, you are tying up our phonelines. We can't help the people that we can actually do something for then.

While you are complaining, there is someone stranded in a foreign country who cant buy a meal because he has lost his card or a 73 year old woman who's caretaker has been robbing them blind that is waiting on hold for us to help them.(real situations from my day at work today)
Works for a Bank

Valley Springs, CA

#8 Aug 7, 2009
Customer Service Rep is a either a liar or totally ignorant of how things work. I have been in banking for over 20 years and I assure you that ANYTHING can be done, or undone as the case may be, to an account. I have seen multi million dollar mortgages reversed...the idea that a credit line or credit card interest rate is somehow etched in untouchable stone is hysterically laughable.

If you worked for our bank and treated customers the way you describe you wouldn't be here for long. No wonder BofA has such a bad reputation if you are the kind of person "helping" its customers.
Customer service rep

Shinnston, WV

#9 Aug 7, 2009
I didn't say I couldn't change APR. I said that I wouldn't unless there was a good reason.

As for the credit line, it is completely decided by the system. Please do educate me though... How would I go about changing that? Walk me through the screens please.

I help those who ask for help. Those who call to use me as their therepist however are ushered off my phone. After you explain to someone that their credit line was cut because they have sufficient debt considering their income and to change that they either need to reduce their debt or raise their income... what else would you do works for a bank?

Or do you consider it ethical and helpful to allow your customers to have three to four times their annual income in debt?
Robots Against Chase Bank

Los Angeles, CA

#10 Aug 11, 2009
It makes no sense to raise interest rates on those who you consider to be at risk. That just makes it tougher for them to pay off their debt.

What would make sense is a LOWER interest rate charge as long as the debtor agreed to pay DOWN their debt.

If some one is a RISK, but can actually pay down their debt if you, the bank, REDUCE their interest rate, then reduce the interest rate, don't raise it, as long as the debt reduces each and every month.

Example, someone owes 10,000 dollars on a card and is paying 10% interest but is now considered a credit risk, Offer to REDUCE the interest rate to 2 percent if they agree to pay down the debt every month by 220 dollars.

Every month the debtor pays down the debt 220 dollars. Allow the customer to RESPEND 50 dollars of that 220 dollars if they so choose as an INCENTIVE to keep paying down the debt.

The result is the debt goes down approximately 150-160 dollars every month, the customer gets to respend 50 bucks every month. Everybody wins.

Banks are evil specifically for not being willing to offer incentives to anyone who WANTS TO PAY DOWN THEIR EXISTING DEBT, and that is why the economy is suffering so much.

Customer service rep, you have been brainwashed by the industry, I hope you see the "incentives" light.

http://www.robotsagainstchase.com
http://www.daily-protest.com
http://www.bloggersagainstchase.com
http://www.consumeraffairs.com/credit_cards/c...
http://www.changeinterms.com
Lisa

United States

#11 Aug 11, 2009
Yes! as a matter of fact, you are extremely rude. And arrogant. And maybe someone should remind you that you too are a little person - one of the everyday masses. And whether you're willing to believe it or not, you're in this too! Our country is in the worst of economical times. And we need to come together, not pull apart. I am curious though, what kind of financial incentives are you getting from your employer to be so cold-hearted and ruthless - not to mention, without common decency? And don't let anyone out there forget that when we were getting our rate break check loans, one of the things the credit card corporations touted that we could do with them, was to pay off higher credit card APR's. We were not offered these deals, because we were irresponsible customers, but because we were good. And to say now that we're a "risk" or undesirable or anything else along those lines is ridiculous at best! Everybody's hurting; being pushed to the limits. But instead of getting rewarded the way that we should be, we are getting damned. And how absurd of you to tell us to go out and get better jobs in an economy like this! Really, where is your intelligence level anyways? And please never forget that it's because of your customers that you have a job in the first place!!!
Customer service rep

Shinnston, WV

#12 Aug 11, 2009
There is a huge difference between being rude and being honest.

I'm actually not in this with everyone else. I don't own a credit card. I always figured if I couldn't afford something, I wouldn't buy it. I have a mortgage only. And even if they raise the apr to 30 percent on it my payments would be less than 300 dollars a month. I saved 70 percent of my home's price for a down payment. My payments are 130 dollars a month. My car I bought outright. No loan. I have four children. My income is lower than most of the people I work with everyday. I have enough in savings to pay my home off outright if I ever become unemployed.

And to Robots, the idea of an APR of 2 percent is insane. Prime is 3.25 percent. You actually want the bank to lose money by lending it? Banks are not charity organizations. The "incentive" for paying off your debt is that you owe your debt. The bank loaned the cardholders money and it is their responsibility to pay it back. I'm sorry if that seems cold-hearted or ruthless but why should we give people prizes for doing what they agreed to do in the first place?

Everyone has the chance to set up payments and lower aprs if they are under financial stress. I tell that to my customers every day. But, they must close their card to do it. Most refuse. Their other option is (Like I said) to improve their financial situation. I estimate that around 80 percent of the customers I work with actively choose to pay more for the privilege of burying themselves further in debt rather than accepting a settlement.*shrugs* I have no sympathy whatsoever for them. You can lead a horse to water but you can't make it drink.

As for my financial incentive, I work for my paycheck. I get paid the same reguardless of what your APR or credit line is.

My intelligence level is an Associates Degree in law, a BA in English, and currently working towards a Masters. I have a 121 IQ. So, while I'm not a genius, I can usually manage to get my shoes on the correct feet. I'm not sure what the requirements were to share opinions and observations about a situations that I deal with every day,but I hope that is sufficient.
Lisa

United States

#13 Aug 12, 2009
And you say you're not rude or arrogant ... my goodness! You're the epitome of those words!
Also, nobody ever said anything about not paying their bills! Once again, that's exactly why we're in this mess - because we did pay our bills!
Robots Against Chase Bank

Los Angeles, CA

#14 Aug 12, 2009
CSR
I specifically was talking about accounts that have been designated as risk accounts. If an account is truly at risk, than getting ALL THE MONEY BACK, even if it takes a few years, would be a victory.

The system is set up right now to entice the banking industry to label as many accounts as "at risk" so they can raise interest rates. The idea I presented above would make banks only do it for those who truly are at risk. It's a win for both sides. That is something the banks have abandoned in favor of a selfish, "me first" approach.

In the case of Chase Bank, they REFUSED to allow their customers to OPT OUT of their credit card agreement. OPTING OUT would have done exactly what you claim your customers don't want to do, it would have closed the account at existing terms.

Maybe your customers don't want to close an account, but Chase Bank customers, who were never late making a payment, would probably prefer closing their account to preserve their 3.99% interest rate and the payment terms already in place.

It appears that Chase Bank's "Pro-Active" division will close accounts and offer 2% interest to anybody who had the life of the loan, low interest rate offer. The one difference is the payment amount stays the same every month for the next five years until the debt is paid off. Not a horrible deal at all, however it still accelerates paying down the Chase Bank low interest loan faster than a high interest loan.

I have calculated that Chase Bank is costing their customers at the very least 100 million dollars, EVERY MONTH!

This issue is about the banks only offering incentives to get new business. The banks are incapable of offering incentives to existing customers, and that is a HUGE problem.

In the case of Chase Bank raising the monthly minimum payment BY 150% on customers who were never late paying their bills and had a FIXED, low interest rate loan, they should have been offering INCENTIVES to their customers to pay down their loans faster.

If someone agrees to pay down their loan over the next five years, those customers get a 100 dollar gift card at least once a year as a thank you.
Until banks offer incentives to people in financial stress, they are not doing their job and Barack Obama is giving them the easy bailout way out.

http://www.robotsagainstchase.com
http://www.bloggersagainstchase.com
http://www.daily-protest.com
http://www.changeinterms.com

CSR, read some of the thousands of complaints against Chase Bank, these people are not all in the wrong.

http://www.consumeraffairs.com/credit_cards/c...
Go F Yourself

Northridge, CA

#15 Aug 22, 2009
This is to the customer service representative:

You have been brainwashed you sorry sack of a human being. When you bend over for the large corporations of America to stick it up your a**, it probably doesn't even hurt anymore does it?
God help you and those that you love that this never happens to you.

On second thought - hope this does happen to you.

Walk in someone else's shoes.

Shame on you.

You hover with your finger over the close button? Your sad need to control and manipulate honest hard working people shows just how pathetic you must feel in your daily life. Big big shame on you. Your time will come.
Customer service rep wrote:
Swindled, and BOA is the worst, I'm going to tell you honestly that you are my favorite kind of customers to deal with. I hover with my finger over the close button when you call in just waiting for you to say the words so that I can close your card and get you off of my phone. You dont want help, you dont want advice, you dont want to face the fact that if we are cutting your credit lines or raising your APRs then its because of something you did.
BOA is the worst, if you want to know why we cut your line of credit, please reread your post. Unless I am mistaken, did you not just say that our cutting your credit line on your business card caused your mortgage check to bounce?
One, that tells me that you might possibly be using your business card for personal expenses. But the biggest thing that tells me is you were using one line of credit to pay another line of credit. Since you said it as if it was normal, I've got to assume that you see nothing wrong with that. That type of robbing Peter to pay Paul lifestyle makes you a risk. Sorry.
As far as demanding to get your line back, demand away. Its not going to happen. You fail to understand that there is simply no way to do it. I mean that. The option does not exist anywhere in the computer system. You can reapply for a higher line of credit, but the factors that decide that are the same factors that led to your cut in credit line. There is no override button.
The way to get that higher line back are to change the factors. Decrease your total debt, increase your income, improve your credit score etc.
Swindled Also, you seem to be failing to understand that while we do take into account your payment history with us to determine your APR, we also take into account your credit report, your debt, and your income. Any over the limits, and late fees, any extra debt with ANY creditor affects that.
If your apr went from 5.84 to 17.86 percent it was NOT the same thing as the first posters change. Yours was a risk based change. That means that something YOU did made you a risk to us. And by the raise, it was apparently something pretty significant. We can change your APR. But to be honest, I personally wouldn't until I had the next 6 month credit report in front of me and only then if I saw a significant positive change or if you had disputed an error with your credit bureau reporting and had negative incorrect information removed.
(On a personal note, If you are telling the reps that you are talking to that we have MBAs in stupid, I promise you that we will follow our guidelines to the letter, as will any other rep that sees the note in your file in big capital letters that you have been abusive. We can and have closed cards because customers are abusive and are completely within bank policy when we do it)

“Liberal Teachers ruin Kids”

Since: Mar 09

Paradise Valley Arizona

#16 Aug 25, 2009
Bank of America

Where is my bailout?
Alessandro Machi

Los Angeles, CA

#17 Aug 26, 2009
I am proposing a Chase Bank tea party protest in which we mail our credit card payments into the Chase Bank corporate offices.

Rather than leave the info here where names are not secure, I have posted an article about my protest at the following blog address,

http://daily-protest.blogspot.com/2009/08/cha...
no credit cards

Jamaica, NY

#18 Sep 21, 2009
Like the Sales Rep, I don't plan on ever using a credit card, or ever borrowing (I'll even try to avoid a mortgage if possible). Why? Because borrowing only makes sense if you intend to take the money that you are borrowing, and turn it into more money than you're supposed to pay back. Those of you who have credit cards with $10,000 spending limits and who are using them to pay off mortgages obviously haven't figured out that you're compounding your debt. Bank lending is not the same as credit union lending: the bank wants to see you make more money in the end, yes; and they want you to come back to borrow more, that's also true. But if you consistently show an inability to pay on time, or handle the debt load you set for yourself, the best thing they can do is recover from you what debt they can and mark down on your credit report that your a liability--somebody who is not worth investing in. Don't give me that crock about the little man, etc. If you don't want to be treated like a little person, don't put yourself in the position, and don't borrow. That's it. Mortgage if you want, but the credit card is a strange, nonsensical device that people abuse, failing to grasp the idea that it's the equivalent to heroine for debtors. And a heroin addict who can't pay for his heroin doesn't get any.
As for those of you who listened to the nonsense about paying off your debts with credit cards, you probably should have paid a little more attention to the section on the [first] "Great Depression" during U.S. History. You see, a lot of people invested in the stock market with funny money--credit--and ended up screwing things up not only for themselves, but for others. The same goes for investing in your own debts. Should have seen that coming, you jerks.
P.S. Lisa, you're retarded. The rep sounds like a smart guy to me. Why he has such a crap job and a degree, I may never know. I think you guys scared him away with your whining. Or maybe it's like he said: you say something three or four times to a customer, and they don't figure it out, they're just there to argue. There are more productive things to do than argue with brick-brained buffoons.
Oh, and "Go F Yourself": go f yourself. You're a "sorry sack of human being" who not only lacks imagination, but mistakes control over others for the simple need to swat away the annoying flies that bother you during the workday. You seem rather bug-like in mindset, if you ask me.*Swats*
I sure hope I'm not wasting my time, either.
BOB

United States

#19 Sep 27, 2009
I have both a Chase card and a BOA, actually 3 each now with the take overs. I was sent a letter by both last week closing 1 account each, both with zero balances and have been that way for some time. No lates, always on time, and yet credit limit was lowered and then apr's were then raised. The rep was posting that they were not making any more $ than before. My interst more that tripled, so where is all that extra $ going.
These 2 banks are what is wrong with ourbanking system, Chase got WAMU at a backdoor steal.
Griswel

Webster, NY

#20 Oct 14, 2009
What I don't understand is how a bank can lure people in with a fixed rate, then change the terms of the agreement to a viable rate. Can a mortgage company do the same? You pay extra to get a fixed rate, i.e. one that does not change, then they change it. All BoA's reasons for wanting a variable rate are the reasons that people signed up for their fixed rate offers.

That sounds like fraud to me.

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