Credit Cards Hit You Where it Hurts – In the Wallet

Have you ever walked into a room and felt like they were laughing at you? You walked down the hall, only to hear the laughter, yet as soon as you opened the door, a silence gripped the room. Well, the credit card companies may be laughing at you. Credit has become more expensive for everyone, including the credit card issuers. A peculiar thing occurred this last month. Chase decided to change the date my payments were due from the 28th to 23rd. I don’t keep a balance on my Chase card and pay it off in full on the 25th like clockwork. On the 25th of July, I logged on to pay my balance, only to find out I was assessed a $39.95 late payment fee. The gal on the other end of phone told me that it was within their right to change the terms due to “market conditions.” I asked her to define market conditions, which she declined. Of course, I decided to speak with her manager who told me that since my payment history was great, she would reverse the late fee. I wasn’t happy about the fee, but not because of the dollar amount, but more because this felt like an attempt for the company to improve the bottom line with late fees…and my dollars. My credit history has been very good, but I would bet dimes to donuts that a less qualified borrower wouldn’t have received the favor.

Additionally, this morning when I logged online to review my account I noticed a message stating “Universal Change in Terms.” It amounted to either agreeing with a rate change from being fixed at 15.99% to a variable rate of up to 26.99% plus the Prime Rate or they would close my credit line. A recent study by Consumer Action found that 77% of the 22 major credit companies can change the credit terms – at any time for any reason. Here is a link to the Consumer Action study.

Things are tough out there for a lot of credit card companies and they are passing the buck by using dollars from your wallet. Before signing up for new credit and even with your current credit, be sure to read the fine print. Commit to being informed, it will pay dividends.

Wishing You Wealth in all its Greatest Forms

Alex