Now this is hard to condone.

[StageLeft]

Link

We know that limits are coming down fast and often times down to just over an outstanding balance, but it appears from this article that some companies are cutting, without notice (since the notice requirement isn't law yet), people's credit lines to below their current balance, automatically triggering an overcharge fee. That is a scam by any reasonable definition.

 

[fallout man]

We don't need more laws and regulations! If we let the market sort it out, compaines will stop scamming customers over in order to cover their own liabilities and make a fast buck!

:roll:

But seriously, this is absurd.

Paul Pensabene of Saratoga Springs, N.Y., received a statement from HSBC on Dec. 8 that said he had a $359.99 balance and remaining available credit of $8,640. But when he went online to pay the bill several days later, his online account showed that same balance put him over his newly-reduced credit line of $300. And that didn't include the $35 over-limit fee. Pensabene grappled with customer service until they agreed to remove the fee, and then paid the balance in full. "All I could think was, 'Good lord, what if this is happening to someone that couldn't pay their balance off in one shot?'" he says. "They'd end up in default with these fees piling up."

How do you go from $8640 to $300 overnight? What was this company thinking giving this guy so much credit when they knew he was only good for $300? This is a scam.

 

[Kwatt]

Originally posted by: Skoorb
Link

We know that limits are coming down fast and often times down to just over an outstanding balance, but it appears from this article that some companies are cutting, without notice (since the notice requirement isn't law yet), people's credit lines to below their current balance, automatically triggering an overcharge fee. That is a scam by any reasonable definition.

Get ready for all the "Just pay it off every month" bunch.

That works unless it is changed in the middle of the month with no notice.



I got a notice on a card yesterday changing the terms to a Prime + card. Rate is now 5.99% + Prime. But, the prime will be a min. of 6%. So 11.99% percent or better. The balance is 0 so it really doesn't matter except for the arrogance of it.

It became #1 on the cancel list.


..

 

[StageLeft]

Get ready for all the "Just pay it off every month" bunch.

I think credit cards are mostly a scourge on personal finances. I used to be in the pay it off every month crowd but it turned out that more months than not I'd carry a bit over. Ultimately it can add up. I recently stopped using it for anything except online purchases and if we want groceries and there's no money in checking we'll wait a couple of days. I've quickly grown a real aversion to these things!

That said, I always just assumed that although a lender can screw you, it would take written notice. I didn't know they could just jack your rate on a whim and give you an overage charge. That's quite absurd.

 

[Kadarin]

It'll probably turn into yet another class action suit where whoever files it will get a little bit of money, the lawyers involved will get a huge pile of money, and the rest of us will get a check for $0.23. And that's if we even bother to fill out and mail in the form that the credit card company sends us to notify us of the proceedings.

 

[miketheidiot]

Originally posted by: Kwatt

Originally posted by: Skoorb
Link

We know that limits are coming down fast and often times down to just over an outstanding balance, but it appears from this article that some companies are cutting, without notice (since the notice requirement isn't law yet), people's credit lines to below their current balance, automatically triggering an overcharge fee. That is a scam by any reasonable definition.

Get ready for all the "Just pay it off every month" bunch.

That works unless it is changed in the middle of the month with no notice.



I got a notice on a card yesterday changing the terms to a Prime + card. Rate is now 5.99% + Prime. But, the prime will be a min. of 6%. So 11.99% percent or better. The balance is 0 so it really doesn't matter except for the arrogance of it.

It became #1 on the cancel list.


..

don't cancel credit cards, it hurts your credit score. just pay it off, and chop it up. When they cancel it do to inactivity it will be done.

 

[Kwatt]

Originally posted by: miketheidiot

don't cancel credit cards, it hurts your credit score. just pay it off, and chop it up. When they cancel it do to inactivity it will be done.

How much does it really hurt? I don't know enough to be sure. This card represents less than 15% of my available credit card debt. The smallest credit line out of 4.

Letting them cancel it do to inactivity will not be near as satisfying as canceling them.
And I'm not sure if letting myself be raped is better because it will hurt a little less.

...

Back to direct topic:

Originally posted by: Skoorb
Link

We know that limits are coming down fast and often times down to just over an outstanding balance, but it appears from this article that some companies are cutting, without notice (since the notice requirement isn't law yet), people's credit lines to below their current balance, automatically triggering an overcharge fee. That is a scam by any reasonable definition.

Do you think these corps. are doing this because they are desperate for any income. And are thrashing about looking for ways to survive? I remember reading somewhere that late charges and overbalance fees are high profit. Not sure if it true though.
Or cutting their total exposure getting ready for the Option ARMs due to reset in 2010-2011?
I really would like to be able to find out if the people getting their credit line cuts are people with a mortgage that will be resetting soon.


...

 

[waggy]

Originally posted by: Kwatt

Get ready for all the "Just pay it off every month" bunch.



[/quote]

i pay mine off every month and think its silly to carry a huge balance.

BUT what they are doing should be against the law. they are reducing the amount (not telling you either) and/or changing the due date so you get hit with huge fee's.

hopefully people just cancel them. all its going ot do is lead many to default on the payments.

 

[fallout man]

Originally posted by: waggy

Get ready for all the "Just pay it off every month" bunch.


i pay mine off every month and think its silly to carry a huge balance.

I don't have any credit cards, so this is a non-issue for me. Living within your own means is the way to go--then again, I'm not married with children.

 

[sandorski]

Wow, just unbelievably scummy. It's like they are trying to get so Regulated that they can't s*** without filling out a Form first.

 

[Moonbeam]

I just made 8 qts of chicken soup with a chicken, three carots, 3 celery sticks, three potatoes, an onion, and maybe 3/4 cups of barley. Chicken soup is Jewish Penicillin.

 

[fallout man]

Originally posted by: Moonbeam
I just made 8 qts of chicken soup with a chicken, three carots, 3 celery sticks, three potatoes, an onion, and maybe 3/4 cups of barley. Chicken soup is Jewish Penicillin.

Did you catch the goy germ?

 

[gingermeggs]

Originally posted by: miketheidiot

Originally posted by: Kwatt

Originally posted by: Skoorb
Link

We know that limits are coming down fast and often times down to just over an outstanding balance, but it appears from this article that some companies are cutting, without notice (since the notice requirement isn't law yet), people's credit lines to below their current balance, automatically triggering an overcharge fee. That is a scam by any reasonable definition.

Get ready for all the "Just pay it off every month" bunch.

That works unless it is changed in the middle of the month with no notice.



I got a notice on a card yesterday changing the terms to a Prime + card. Rate is now 5.99% + Prime. But, the prime will be a min. of 6%. So 11.99% percent or better. The balance is 0 so it really doesn't matter except for the arrogance of it.

It became #1 on the cancel list.


..

don't cancel credit cards, it hurts your credit score. just pay it off, and chop it up. When they cancel it do to inactivity it will be done.

Thats if they don't have a monthly service fee!

 

[heyheybooboo]

I just can't believe you guys are picking on those poor hard-working credit card companies.

What's next? Are you going to disrespect payday lenders, title loan companies and your cable service provider?

:roll:

 

[Lemon law]

Anyone who is confused about credit card law does not understand congress. On one hand, congress set up a utropian scheme where credit card users had all kinds of rights, and at the same time congress permitted legalized loansharking and absurd interest rates that would make your average mafia loanshark blush.

And because the profits to credit card companies were so great, at no time did credit card companies ever seek to see the legislation change, and when it came to the billions of dollars of credit card profits that might be endangered if credit card companies actually required merchants to become partners in fighting credit card fraud, they were perfectly willing to pay off the fraud rather than endanger the merchants perception that no matter what, any credit cards transactions are better than gold.

After that, credit card companies have always asserted the ability to both play fast and loose with both congressional law and contract law by asserting a non existent right to alter a previous contract, by changing the rules to suit their own advantage.

This thread is about the same ole same ole, its long past time for congress and the legal profession to tell the credit card companies they can't do that. But they have a lobby and consumers don't.

 

[Acanthus]

Originally posted by: heyheybooboo
I just can't believe you guys are picking on those poor hard-working credit card companies.

What's next? Are you going to disrespect payday lenders, title loan companies and your cable service provider?

:roll:

:laugh:

 

[Hacp]

If you don't like it change companies. Or even better, you can cut up all your credit cards and live a debt free life.

 

[IronWing]

The sole criteria we use to make changes to the terms of your account is maintaining the profitability on your account.

- My CC Bank upon announcing the new prime+15.99% APR.

They also cut my cash advance limit in half. Neither affects me as I'm in that bunch who pays off every month and only took out a cash advance once (by accident, used the wrong card at an ATM). So far they haven't cut my credit limit.

 

[StageLeft]

Originally posted by: Hacp
If you don't like it change companies. Or even better, you can cut up all your credit cards and live a debt free life.

I don't think you read the thread, but rather just pulled that from a "Ah, this is another credit card hate thread on P&N, this is my cookie cutter response."!

BTW, citi pissed me off last year. I could have called to cancel, but they don't care. I'm just another number. The more effective way to "get back" at them is to keep the card paid off and I will just use it every six months. This way they maintain my open account, I pay $0 to them, and it continues to prop my credit score. So now I get to use them.

 

[Phokus]

Free market FTL

 

[her209]

Who didn't see this coming?

 

[sandorski]

Originally posted by: Skoorb

Originally posted by: Hacp
If you don't like it change companies. Or even better, you can cut up all your credit cards and live a debt free life.

I don't think you read the thread, but rather just pulled that from a "Ah, this is another credit card hate thread on P&N, this is my cookie cutter response."!

BTW, citi pissed me off last year. I could have called to cancel, but they don't care. I'm just another number. The more effective way to "get back" at them is to keep the card paid off and I will just use it every six months. This way they maintain my open account, I pay $0 to them, and it continues to prop my credit score. So now I get to use them.

I'm surprised you would actually need to Call them. They Call me 3 or 4 times a week! :|

 

[Kwatt]

Originally posted by: her209
Who didn't see this coming?

I'll have to admit I didn't. Raising rates I can see. Lowering limits OK. But lowering limits below your current balance... I never imagined.

Would it not make more sense to lower rates. If Prime is ~3.25 and the rates are lowered some people might take advantage of it. I have Prime rate card from Capitol One and I am scared to use it. I don't want to buy a $500 item and get the limit lowered to $300 on the way home. Even if planning on paying it off as soon as the bill arrives I would still have to spend the time getting the over the limit fees removed.

..

 

[Genx87]

Paul Pensabene of Saratoga Springs, N.Y., received a statement from HSBC on Dec. 8 that said he had a $359.99 balance and remaining available credit of $8,640. But when he went online to pay the bill several days later, his online account showed that same balance put him over his newly-reduced credit line of $300. And that didn't include the $35 over-limit fee. Pensabene grappled with customer service until they agreed to remove the fee, and then paid the balance in full. "All I could think was, 'Good lord, what if this is happening to someone that couldn't pay their balance off in one shot?'" he says. "They'd end up in default with these fees piling up."

This should be illegal if this is the whole story.

 

[fallout man]

Originally posted by: Genx87

Paul Pensabene of Saratoga Springs, N.Y., received a statement from HSBC on Dec. 8 that said he had a $359.99 balance and remaining available credit of $8,640. But when he went online to pay the bill several days later, his online account showed that same balance put him over his newly-reduced credit line of $300. And that didn't include the $35 over-limit fee. Pensabene grappled with customer service until they agreed to remove the fee, and then paid the balance in full. "All I could think was, 'Good lord, what if this is happening to someone that couldn't pay their balance off in one shot?'" he says. "They'd end up in default with these fees piling up."

This should be illegal if this is the whole story.

Smaller guvment! Oversight is nazi-tiem!!!1

Let teh markets sort it outs!@@@!!!!1