This is an UPDATE on a previous blog entitled “The Bill of Rights for Credit Card Holders” .
Credit card holders rights just took a turn for the worse. Some banks, most notably Citigroup and Bank of America, have thought of other ways to make money in lieu of increasing interest rates to fairly new customers; which is just one of the many things that are prohibited under the “Credit CARD Act of 2009.” Basically, credit card issuers are looking for other ways to offset income losses that will occur when the full Credit CARD Act takes effect in February of 2010.
Most people these days are cutting expenses due to the state of the economy. Citigroup is punishing their customers who are cutting expenses by charging a annual fee if they do not spend a certain amount on their credit card; this minimumn amount is around $2,400 a year. Even worse Bank of America is punishing customers with a annual fee, ranging from $29-$99, even if you have paid your credit card off in time! You could of never had a late payment in your life and might be charged for it. You can be punished for being a good citizen.
These changes with fees being charged by the banks are deemed as “experimental,” and are only testing a small percentage of their customer base, and there are no permanent enactments, yet. With the banks likely to lose some money due to the Credit CARD Act these “experiments” can turn into “permanent” rapidly. It is rare that the banks will revert to “no fee” credit cards any time soon!
What can you do? If you notice you are one of the small percentage of people being charged these fees you can:
- Call and complain to your credit card issuer. It would be better if you are in good standing with the creditor
- Weigh the benefits of the rewards against the fee. You need to determine if the benefit you receive from the rewards on your credit card exceeds the fee you are being charged.
- Leave/cancel the card This should be your last option, if you do not want to pay the fee ,because closing a bank account could lower your credit score.
Make your voices heard to make sure you are not being punished for doing the right thing. Protect the rights you have as a credit card holder!
