Interest rates going up? Decline the terms!

Discuss anything related to interest rates & fees, like balance transfer offers, low rate cards, annual fees, etc.
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ujt3994
 
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Interest rates going up? Decline the terms!

Postby ujt3994 » Sun May 02, 2010 5:16 pm

Hi Everyone,

I've read a bunch of threads here from people who have balances and have had their interest rates go up. But no one is telling them the solution!

You can "decline the new terms", if you call the CC company withing a certain period of time after you receive the notice. They won't be able to raise your rates if you do this. Usually they will close your card right away, but I have seem them allow you to keep the card active for up to a year.

I've known about this for years; last year I finally used this trick when both of my card companies doubled the rate at approximately the same time.


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Mogul of Pineapples
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Postby Mogul of Pineapples » Sun May 02, 2010 9:47 pm

You're right, if you have no other options that is the way to go- you can continue to pay down the balance on your old terms.

But what you need to keep in mind is that it might hurt your credit. It could show on your credit report that the card was closed by the bank (not you). The other thing is that the credit limit is usually instantly cut to the amount of your balance, so it will show you are using 100% of your credit limit. I agree if you have no other options, it's the way to go. But a balance transfer or some other way would be preferred so it doesn't hurt your credit, but I do understand not everyone has those options available right now.
Disclosure: I am a moderator/paid staff of this site, which does have advertising relationships with some credit cards that are discussed and linked to. Regardless, anything I say is my honest opinion.

Current Cards:
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alsteig
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Postby alsteig » Tue Jun 01, 2010 12:24 am

I agree with MOP. Last ditch if you are paying down huge balances then decline the new terms, but your credit will be done for. Calculate what you would save vs. what your cred score is worth today. It is different for everyone.

ripley1423
 
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Interest Rate Going Up? Decline the Terms!

Postby ripley1423 » Wed Jun 16, 2010 3:09 am

What happens when you have a zero balance on the card, decline the change in terms, and ask to close the account?

It's interesting that many banks will not respond to such a request, and I have to write to them again to request that the account be closed. It's as if they want to be able to say "Gotcha!" if I ever use that card again.

ujt3994
 
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Postby ujt3994 » Fri Oct 01, 2010 7:45 pm

Mogul of Pineapples wrote:But what you need to keep in mind is that it might hurt your credit. It could show on your credit report that the card was closed by the bank (not you). The other thing is that the credit limit is usually instantly cut to the amount of your balance, so it will show you are using 100% of your credit limit.


I finally got around to checking my credit report and neither of those things are true.

My credit report shows both cards with the original credit limit, and the "percent credit used" number that applies to the whole credit report is in line with the original credit limit and current balance.

Also, it says that the card was closed by me and not the bank. After all, I am the one who requested the closure.

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Mogul of Pineapples
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Postby Mogul of Pineapples » Tue Oct 05, 2010 4:26 pm

ujt3994 wrote:I finally got around to checking my credit report and neither of those things are true.


Please notice I said that it might happen (and it often does). You lucked out if your bank doesn't handle it that you. Search on this forum to find plenty of stories from others where what I mentioned did occur.
Disclosure: I am a moderator/paid staff of this site, which does have advertising relationships with some credit cards that are discussed and linked to. Regardless, anything I say is my honest opinion.

Current Cards:
American Express: Blue Cash, Simply Cash Bank of America: WorldPoints Platinum Plus Chase: Amazon, British Airways, Cash Plus Rewards, Freedom, Ink Cash Citi: Thank You Premier, Dividend Platinum Select Discover: More
Primary Everyday Card: American Express Blue Cash
Primary Travel Card: Chase Sapphire Preferred



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