Credit card companies: Penalties after the fact

Citi and CapOne both did this to me in the past three years. Both cards have been paid off, and both were cancelled immediately after paying them off.
I was actually telling a buddy about them doing that to me the other night, because he was afraid his Discover had just done the same thing.

 

That almost happened to me. I had wrung up a high credit card bill because we had bought a house before selling our previous house (work issues). Ouch. Anyway, we had everything paid off after the house sold, but a few months laters Discover cut my limit to below where my balance was just a few months earlier. Whew!

Pieces of shit. Funny how when the economy was going well they sent me letter after letter informing me that my credit limit had gone up. (I can buy a car on my credit card!)

We need to Tyler Durden those cock stains.

 

I use credit (not debit) because of the float and for the few hundred a year I get in cash back/reward points/etc.

One huge disadvantage to debit is, if your card is stolen/lost/etc. and someone uses it, the money is gone immediately. With credit cards, you have a lot more recourse in terms of stopping payment, etc., which I think helps your case in not having to pay for fraudulence. Debit cards make the same claims, but in those cases your money is already gone, which complicates things in terms of negotiations with the card issuer.

 

If you have the credit history, resources and the discipline to game the float and the rewards, credit cards are a great thing to have. I'm definitely not saying no one should have thetm.

 

Unfortunately, for everyone who actually profit from the float and frequent-flier miles, etc., there are many more who will lose so much more than they ever net.

Having a credit card is like placing a show bet on a 1:5 horse that is guaranteed to finish top three. It all works out fine, time and again, until something unexpected happens and you lose your ticket, transpose the numbers you're betting on, or otherwise slip up, and you lose your shirt all at once.

 

Capital One just did that to one of my wife's accounts, going from 13.9% to 29.9% without reason---she wasn't late on a payment and had a good history with them. The thing is, it's an old account with a $1000 credit limit, so it's not as if they're going to make a fortune on finance charges from her anyway. Every little penny they can get I guess...bastards.

 

When Joe Biden was in the Senate he was at the forefront of creating laws that protected consumers from the predator credit card companies. Thank goodness someone minding the store.

Now that Joe is no longer in the Senate I wonder who is advocating on behalf of consumers.

 

The douchenozzles did that to me as well, jacking my rate from 10.9 to 17.9% just because. When I called to ask why they were taking out their shitty business decisions on their best customers, I was curtly informed that "this was a business decision and I'm free to close my account at any time."

Of course, should I do that, not only will I have to pay off a low four-figure balance, but my credit score will go down. And the POS know that.

Then again, it's going down anyway. That same week, AMEX cut my credit limit to $250 above where I was at, despite the fact I haven't missed a payment with them in forever.

These parasites need to be regulated within a pubic hair of their miserable existences, the sooner the better.

 

I closed one after I paid it off when they raised the rate to 25 percent because my wife tried to pay it online and paid a different account with the same bank twice.

But I wish I hadn't closed it out. It's better to pay it off and leave it. The more credit you have available that you don't use, the better your credit rating. If you do carry a balance, it's nice to have the flexibility to move it around -- say to a bank that is offering 0 percent for a year.

 

One of the happiest days of my life was when I made a big score and wrote checks to pay off the credit cards. Swore off them and have stayed off them. I pay with the debit card, which makes you think real hard about any unnecessary or impulse buys.

Prior to that, the fuckers had me over a barrel and knew it. They did everything they could, including raising the interest rate, tacking on fees, etc. Never again.

 

This was touched on in another thread and there is a price to pay for having your credit limit decreased - it affects your credit score, as you are using a higher percentage of your available credit because the limit is cut. It's a big difference when you have a $1,500 balance on a $2,000 limit as opposed to a $1,500 balance on a $5,000 limit.

But as a note to readers - don't cancel your credit card account once you have paid off a card. The zero balance on a card with a $2,000 credit limit helps your credit score and by canceling that card, you're essentially affecting your credit score.

 

Two thoughts here....

With record numbers of people out of work, a lot more people are having to use credit cards just to make ends meet: groceries, gasoline, necessities. So you spend $200 per month on them and pay the $100 minimum. Balance keeps going up.

When this entire financial crisis blows over someday... and it will, sooner or later, it will be interesting to see how financial institutions approach credit. Yes, many got burned, largely by making bad loans that people couldn't repay. But a lot of decent, well-meaning people got screwed because they got in situations not entirely of their own doing.

My credit score has taken a major hit because of extended periods out of work because of either illness or layoffs. I'm not all THAT worried because I know tons of people are in the same boat. If the banks say "OK, no more credit for you, ever" that is going to further slow any recovery because the economy runs on credit. No credit: no one buys cars, houses, big screen TVs, airline tickets or much else. This has affected far too many people to have them on the sidelines forever. So, it is my belief that the banks are going to have to devise some mechanism to allow credit while still protecting themselves. Will be interesting to see what happens.

Maybe government takes over SOME (but not all) banks and extends credit to those who can't get it elsewhere. Government has a vested interest in seeing people buy and sell and if no one has capital, that doesn't happen (thus, the situation we are in now).