CBS 5 Investigates With Anna Werner

(CBS 5) After our story aired, we heard from a lot of you about credit card rates and fees. To send us your comments, click here. Here are the emails we've received so far:

From J. in North Carolina:

I actually am writing after finding the other email responses to your report through Google. I opened my mail tonight to find a notice from Capital One that my rate would be changing from 17.9% to 22.9% starting July of 2009.

It's already more higher than I'd like! However, like many many others, I pay well over the minimum balance and am not late and have had this card for at about 9 years. What frustrates me to the extreme is that my options are to opt out by July 28 after which they'll close my account the next month, or suck it up.

I long ago became a big fan of living on cash. However, I can't pretend that my credit status won't be heavily influential in my future home purchase and even future career changes. So I'd like to at least maintain the lines of credit I have because closing lines of credit negatively affects one's credit score.

These companies are forcing our hands! They are essentially putting people between a rock and a hard place and saying "Pick one, either way, we win. Oh and by the way... we don't care about your well being." They've got our tax money already and now, they'll have more money from high interest rates or ruin our credit.

It would be very helpful if there was guidance on the best way for the consumer to come out of this on top. I'm beyond frustrated and I don't want to make a decision in haste.


From B.R. in Michigan:

I have a Capital One Card also (my only major credit card, aside from my debit/checking card) and I received notification yesterday of the increase effective July 2009 to 17.9%. I am livid!

I called Customer Service and received scripted responses, and little concern. My only option is to close this account, I cannot take the risk of the variable rate increases they have outlined. Further, I have a solid credit rating. And while I have carried a high balance, I have always paid on time and paid consistently more than the minimum payment. This practice should be deemed illegal by creditors and banks and I support all actions to rule this as such.


From Staci in Fremont:

This credit card situation is crazy! In Wed. mail I received 3 letters from Discover. The first letter said that the currently high APR rate would increase in May due to economy set backs, the second said to use these checks for 6% APR on that purchase, then the third said if you use your card for gas you get 1% APR on those purchases.

How can they afford to do that if your original APR is going up for economy reasons but here's a couple deals they're able to do? I was looking at an oxymoron in one day of mail. Needless to say, I will be paying that card off and closing it out.

It's ridiculous what the banks are doing to everyone and quite sad that you have to be in default in order to get help from mortgage companies too. I sure hope this all gets worked out soon for everyone's sake. Thank you for your time.


From Ronald in California:

Well Chase refunded the $10.00 a month service fee but after a phone conversation with them they stated they would not be refunding the interest accrued on those charges.


From Dorothy in Boothwyn, PA:

I also have been burned by Bank of America. I've had 2 credit cards with them for years, both were 0 balances-7.9% and 8.99% interest. I just received a letter from them stating that due to my payment history, they were raising the lowest interest card to a variable rate-13.99 %.
 
I called them, and their answer was that due to the economy, they had to hike their interest rates with everyone that carried a balance. I only carry a monthly balance and pay it off each month. I have an excellent credit score-over 800.

I told them they were loan sharks, as far as I'm concerned and would go somewhere else with my business. They could have cared less!


From Merle in San Jose:

I have been experiencing interest rate hikes and reduction of credit limits for over a year now. And I, too, have not been late and am paying more than the minimum balance on my cards -- even with the monthly payments almost doubling.

I received a letter from B of A that they are going to increase my APR from 15.65% to APR of 25.74%. That's really too high. Please tell me how I can participate in whatever action is being taken to enact some type of legislation.

I know there's something that they can do about those Bank of are SHARKS.


From Connie in Oakley:

Frankly, I am fed up Chase. I had a low interest credit card, but they doubled my interest rate last year and demanded that I accept the new rate or cancel my account and pay the remaining balance. I talked to numerous "higher ups" in the company and they refused to do anything.

I finally opened a WaMu credit card and did a balance transfer from my Chase Card. I can't begin to express how angry I was to hear the news that Chase bought WaMu. In the last few months, I have been receiving my bill and there has continually been a $39.00 overlimit fee attached. I've called to complain because this overlimit status is being created because of the interest charges.

Again, when I call I'm pretty much being told I have to pay it or I'll be in default. When is this kind of thing going to be stopped? I really sympathize with people who are getting in these credit card situations. Chase is not the only bank backstabbing their customers. Several of my other credit card doubled interest rates just because they could use the loophole in the cardholder agreement.

If you ask me, banks in general, are just digging themselves into a deeper hole. More and more people will begin defaulting on their credit accounts as a result of these banking practices. The economy is currently faltering and many people are struggling to keep up on their bills. The last thing any of us need is the continued greed of these corporations which precluded the economic situation we are now facing.

I can't believe they think by doubling interest rates, attaching erroneous fees, and increasing payment amounts is going to benefit them. We saw the same thing in the housing market. Banks and mortgage companies haven't learned a thing. When they didn't work with their customers in the past they were overwhelmed with foreclosures.

IF they continue their present tactics people will also begin defaulting on their credit cards. In my opinion, the banking industry needs lessons in simple economics. First, You need customers to make a profit. Second, you need to keep your customers happy in order to keep your customers. Third, If you are spending more than you net...well, you won't be in business long. Then again, I guess they figure they can just put their names in the pot for some of the bailout money. Thanks for letting me give my opinion.



From Bill in Pleasant Hill:

Here is one that will alert you to BofA and how greedy they are. I lost my job but was smart enough to have Credit Card protection on all my credit cards that gives me protection when out of work or death benefits to pay off the card in case of my death or my wife.

Most all of the cards have frozen the accts and no interest charges are being accrued while out of work. That is perfect. BofA's CC has a plan where the insurance company makes payments towards the card as if I was paying. That is even better...but!! They have also cranked up the interest rate to 29.9%.

That is not effecting my bottom line right now but it is sure stealing from the insurance company. I have over 800 on my FICO score and have always paid my bills.

My other cards are in the single digit percentage rate yet BofA feels that they can use any excuse in the book to up the rate...your income has gone down!! Therefore you are a bigger risk!!!

I'm on unemployment but I have protected myself with this insurance which is not cheap. BofA is taking advantage of it and me. How can they just up the rates because some executive sees a golden egg with my insurance.

If my rate was down to single digit like the others my card balance would be going away. These folks are criminals. Loan sharks who had these rates years ago went to jail!! When will this stop. Sure give people credit and then screw them....that is a way to help the bank and screw the people.


From Emma in Sonoma County:

I have seen some of your news regarding the credit card hike on interest. I have been a customer of ADVANTA. Their hike was the most ridiculous that I have ever heard of. They were charging me 10.74%, then it jumped to 20.83%, then on my Nov statement the regular interest jumped to 31.31% for purchases and 36.31% for cash advances.

Then in Dec of 2008 it jumped to 32.18% for purchases and 37.18% for cash advances. Then I got a letter which is not even dated which it stated that the percent they were now charging was 96% and that the past due interest on top of that would be 4% more.

Called the credit comp various time and they just told me that they increased my interest rate because they could. No one there would answer any of my questions. I sure hope that something gets done before some people start contemplating things.

From Maya in Kingsburg:

Well, I just got a little flyer from Chase, informing me that my interest rate will be increasing in May 2009. Currently it is 9.24%, but the increase will be Prime plus 13.99%, which of as of February 17, 2009 is 17.24%.

Needless to say, I am a tad peeved. Unfortunately, I cannot pay it off in one fell swoop, but I did immediately call and tell them I was not interested in doing business with them any longer.

I wonder if this has anything to do with the fact that I used one of the checks they always send you in the mail? You know, the ones they want you to use to "pay off high-interest debt on your other cards"?

I am getting mighty sick of this whole game. And if it ever comes to me having to walk away from my bills, the credit cards will be first in line. After all, they have no shame in shafting me, why should I feel bad about defaulting on them?


From Sara in Vacaville:


Hi Anna, First, I would like to thank you for your great investigative work and dogged determination to make things right. I, too, have been experiencing interest rate hikes and reduction of credit limits for over a year now. And I, too, have not been late and am paying more than the minimum balance on my cards-- even with the monthly payments almost doubling.

It started w/ Bank of America about a year ago and has continued on w/ Chase, Citibank, GE Money Bank, and so on. The latest of what I call *credit rape* is Citibank changing my APR for my Sears card from 7.24% to 23.99%! And that is not for new purchases but on the existing balance.

Of course, I've opted out which closed the account, but I am now forced to pay for a credit card that I can no longer use. Interesting to note is that when I inquired about the Sears card rate increase, the representative also felt the extreme increase must be in error, but upon double checking, verified the change was indeed going into effect but no reason was given.

THIS MUST STOP! I too am fed up, fired up, and want to do something about it! Please tell me how I can participate in whatever action is being taken to enact some type of legislation NOW. Even if it's too late to help myself, perhaps I can help others.

From Mel in the North Bay:

My interest rate increased, too. I know it is because of the coming legislation (which I've been actively following) and I wrote my Representative Thompson several weeks ago with no reply. Nada. I even sent snail mail.

We have a good solid credit rating. We pay on time and over the minimum when we can. We've reduced our debt load and are continuing to reduce it. There was no reason for Chase to raise our interest rate. It was only 3% and my balance isn't large but still it is the principle.

And now I find from your story that there are people hurt much worse than we were. BTW, banks receiving bail-outs have been and are actively lobbying against and fighting any such legislation. I hope action is taken soon and I'm ready to get even more active. If I am told what I can do, I will do.


From Donald in Oakland:

Unfortunately, my cards are a (now) Chase VISA and a Capital One MasterCard and they will be hiking my interest rates into the high 20's despite a good record of paying on time and more than the mininum. Where are Senators Feinstein and Boxer?


From Denise in Santa Rosa:

About a year ago I was sick and tired of dealing with Chase. When WaMu offered me a credit card with a $11,000.00 limit at 11.49% interest I jumped on it. I transfered my balance from Chase and closed the Chase account.

From then on I tossed out any mail I received from Chase, vowing to never do business with them again. I scheduled automatic payments with my WaMu card and checked my statements on line. Therefore I did not pay much attention to mail I received from WaMu either.

In February I received a notice from WaMu that Chase had taken over WaMu. Chase has raised my interest to 19.99% and my minimum payments went from around $147.00 to $249.00. I am unemployed, have been for two years. I cannot afford to make that kind of payment and I don't think it is right that they raised my interest. They are not abiding by the terms I signed up for with WaMu.

I would NEVER have signed up for a credit card with these kind of terms. I am very frustrated and feel helpless to do anything about it. I will cancel my card, but I am still stuck paying at their exorbitant rate. I hope to get as much as possible transferred to a new credit card that I am applying for at my local small bank.


From Tom in Alameda:

Citibank raised my intetest rate from 7.99% to 16.99% in February. I immediately called them and told them that if my rate wasn't reduced I would close my account. I was put on hold for 2 minutes and then the rep. came back on the line and said that if I would keep my account open they would reduce my interest rate to 6.99%, even less than it was before.

It looks like if you have good credit some banks will work with you but you have to make that call to find out.


From Ted:

I saw the broadcast last night as well. We did some remodeling on our home 2 years ago and went a little over budget. I had to put $10K on my BofA Visa and they are absolutely killing me. I have my own schedule to pay it off and I have another 15 mos. to go. My Visa bill is over $800 a month with $146 in interest on my balance every month. Can someone help me?


From Jonathan in Los Altos:

I faithfully pay off my credit cards each month. Citibank cut the credit limit in HALF on a card that I had not used in months. It also cut the credit limit on a card I do use once in awhile.

Don't know how someone who pays their bills in full every month, is employed and solvent is suddenly such a credit risk but I do know that credit limit reductions negatively impact one's credit rating.

I was so angry with Citi I cancelled those cards immediately and have applied to my local credit union for a new card. Screw these big banks, I will not be back!!


From Jancie in the East Bay:

I, like many people I know who have always paid their cards on time, have also seen the rates on credit cards increase. It seems that banks are operating with the same level of stupidity that got the economy into the shape that it is currently in.

Have banks given any consideration to what will happen if massive numbers people start to default on credit card payments also? Apparently not. Why are the Feds waiting until July 2010 to ban the unfair and deceptive practices of credit card companies? Isn't there some sort of class action lawsuit that can be filed, or injunction preventing this type of behavior. Why wasn't this considered in the bailout package?

I find it incredibly reprehensible that the very people who pay their credit cards on time are the one's being penalized. Lastly, perhaps credit card companies should beware; just like the Boston Tea Party so long ago, cardholders may revolt also!


From Diane:



I am commenting on Channel 5's news story, "East Bay Man's Credit Card Bill Doubles in a Month".

Washington Mutual Bank has been bought out by JP Morgan Chase. Along with my bank account, the Washington Mutual Mastercard account is also controlled by Chase.

I was approved for a Mastercard with a $7,000 credit card limit last April with 11.49% interest for purchases and 23.99% interest for cash advances, not low by any means but not high either.

I have a FICO score of 736, have never been late with a payment, always paid more than the minimum and have recently been informed that through the process of transitioning from Washington Mutual to Chase, and after a review of my account, my interest rates will be going up to 25.99% for purchases and 25.99% for cash advances, which means my monthly payments will be doubling. I am outraged!

I called Washington Mutual/JP Morgan Chase and spoke to a representative who basically repeated what was stated in the letter I received. I believe Chase is taking unfair advantage of their clients!

Also, I just recently found out that the $2,000 cash advance I took out this Fall, which has a higher interest rate attached to it, is the last thing that is paid off on this credit card; therefore, I will be charged double interest rates until the $5,000 in purchases is paid down first. I was shocked when I found out because I wasn't told this up front!

Thank you for allowing me to share my story.


From Chris:

I have 3 different cards with Capital One. 1 Visa and 2 Master-cards. 2 of the 3 sent me notices that my terms are changing and my rates are going up. My Master-card is going from it's current variable rate with on my last bill was at 3.40% to what they said would equal 9.9 % against the prime. My Visa is going from it's current Variable rate on my last bill of 10.49% to 17.9%.

I called Capitol One when i got the notice about the Visa and the account Manager said they couldn't give me any "specific" information

about why they did what they did, just that they are "hunkering down" and "getting the umbrellas out" for what could turn out to be a rough year in our economy.

I just got back from vacation and got the notice tonight about the Master-card. I don't see any point to calling them as they will not tell me why specifically they are changing my rates.

Obviously i'm ticked off as i feel it's unethical to be raising rates to people at this time when we are bailing out Banks with our tax money. The other part that doesn't help out economy is that i will probably not use these cards for a while and that means reduced spending.


From Lisa in San Jose:

I was a Chase customer until recently. I was always on time with payments to my chase credit card. I always payed more than the minimum amount required each billing period.

Recently I was a few days late on a payment, and my interest rate of 6.99% was increased to 24.99%. I contacted Chase to see if something could be worked out as far as lowering this high interest increase.

I was told there was nothing they could do, and to call back in a month to possibly have my interest rate lowered. I did just that, and not to my surprise they said there was nothing they could do.

I ended up closing my account, and had my balance transferred to another credit card with another credit card company. About two weeks after I closed my Chase account I received a letter from chase stating they noticed a large payment on my account and were wanting to keep me happy as a customer by offering me a 0% interest rate on purchases for the next six billing cycles.

Why couldn't do that in the first place, before I closed and transferred my account?


From Joanne in Cotati:

The problem I'd like to share concerns Chase's cash advance procedures. It's a policy I'd never heard of though we are very experienced credit users. In talking to Chase we found out that if you take out a cash advance on your credit card, no amount from the monthly payments you subsequently make is ever applied to reducing that item, and it will continue to accrue interest upon the full amount of the advance until the rest of the balance of the account is paid off in full.

The amount in our situation is relatively small so we'll be okay. But, I'm sure most people have never heard of this provision, and for someone who is unfortunate enough to take out a large advance without knowing about this policy and understanding its implications, it could be a devastating financial trap.

We have had this same credit card account for years as it morphed thru various bank mergers. We have an 800 FICO score, pay far more than minimums monthly, and around the end of 2006 since we had previously been running a higher balance due to our home improvement project, we even sent them a lump-sum payment of $8,000. And, still not a penny was applied to that 2004 transaction.

It gives you the feeling you're watching the decay of American civilization when this sociopathic abuse is the everyday experience good customers have of American business, or at least American banks.

I hope spreading the word about the existence of this policy will allow some people to avoid getting sucked into this particular destructive credit card trap, especially in view of the fact that it may no longer be easy for many people in these tougher times to get relief by transferring to some other credit provider. Keep up the good work.


From Sarah in Vallejo:

I'm writing to complain about the change in terms of my credit card. I recently saw the news about the man who's credit card company, Chase, changed his terms too.

I have a Capital One credit card account. I lost my job last year, and I final was able to start making my payments again. I received a notice from Capital One that said, my fixed rate of 8.99% is changing to a veriable rate of 13.9%.

The notice also says, "If you decline, we will close your account". I can't afford that. What can I do?


From Sylvan:

Hi, I have Capital One credit card. I have been with them for a LONG time. I always pay off my balance every month. I have excellent credit ratings, period.

Yesterday I got a notice in the mail saying that terms were changing from 7.90% APR on purchases and 19.80% APR on cash TO 14.65% APR on purchases added to Prime rate (which will vary monthly), and on cash, APR will vary monthly by adding 21.65% to Prime rate.

I have never been late with any payment. I am saving rewards, and was also told if I don't want to accept these terms, I need to redeem the reward points or loose them by May 17, 2009! I was hoping to save a few more reward points to by an airline ticket for my aging parents, which I do periodically.

With this ridiculous "ultimatum" coming out of the blue...I won't be able to get another 5,000 points (because I won't be wanting to spend that much on credit) before May and will have to get something else for my "reward." Something fishy about this, no?


From Robert in Cupertino:

I am glad that someone is finally looking into the problem that I have been emailing different consumer watch groups and others trying to find help.  Recently my Citibank Platinum Credit Card was raised from the 8.75% interest rate that I have enjoyed for many years to 24.99%.  There was no late payments, no change in payment practices by me, just a change in their cardholder agreement.  When I inquired about the change I was informed that I could say no to the change in interest rate and that my account would be closed as soon as the card expired. 

About one week later I received my Home Depot account bill and lo and behold, it is owned by Citibank and that rate went to 24.00% as well with the same terms, don't accept the new interest rate, we'll close your account.

My wife also has a card with Citi and so far her rate has stayed at 13.5%.  Citi will not explain to me why my rate went up, for no reason and hers is the same.



My wife has a card that was originally Providian, then became WAMU and is now becoming Chase.  Just after Chase took over they increased the rate from 7.92% to 19.92%.  When I asked the bank what was happening and if they could lower the rate, I was informed to default and contact a credit counseling agency. 

I feel that these credit card companies and banks are creating a self-fulfilling prophecy.  First they accept federal bailout money to help them out.  Then they increase the rates or the amount that has to be paid back on all their different cards. This causes the average consumer that was already having a bad time, to struggle and have to be late or worse just stop paying their cards. 

Then the banks and card companies go back to the government and say that all these people are now defaulting on their cards and they need more money.  The banks will end up going under due to the fact that they are not working with the average person and are in fact causing a greater financial crisis than we are already in.


From Elonda in Suisun:

I thought I would share my story.  My card company, Capitol One, (who I have been a customer for over 9 yrs, in good standing), just sent new change in terms to raise our interest rates from 8.9 percent to 18.9 percent.

When I phoned to inquiry re: reason, they informed me, it was due to the ecomony. I said don't you think you should do more to help us as customers, and not hurt us. I was informed, if I did not like it to close my account.

I was very surprised. I told the representive there would be no way I could continue as a customer: because with the economy being out of control we carry a high balance(including some balance transfers & college tuitions) & sometimes have the need to use our credit card.

The representive did not appear concerned, then advised me millions of accounts are affected not just mine. Then I was told, I could close my account if I wasn't happy.

I say all this to say, I think there should be regulations against the credit card companies, and they should not be allowed to take advantage of customers who are barely getting by.

In these day and time, it seems the customers who are able to continue to pay on time, are the very customers that are being taken advantage of.

Please continue to investigate these credit card companies, and bring the unprotected consumer some relief. Thank you in advance for your cooperation.


From Karon in Pacific Grove:

On your program the other night you said for anyone who has had their credit card rates increased recently to email you. Well I just got a letter from my Capital One credit card company and they are raising rates on purchase & balance transfer, cash advances, and default %.

Explanation stated by Cap One was due to extraordinary changes in economic environment, your account's purchase rate, and length of time had this rate & account, we will be increasing hyour purchase rate, raising your cash advance & default rates.

Only option they give is to decline this change and close the account and pay down balance at existing terms!! This is Capital One Bank (USA), N.A., P.O. Box 30285, Salt Lake City, UT 84130-0285.

Sure would be the right thing to do and asap for Congress to stop this kind of thing. Also my Washington Mutual credit card company closed my credit card because I hadn't used it recently. Tried to reopen it and they would not let me. Would have to reapply.

Thank you for your interest in helping in this kind of dishonest practices of credit card companies.


From Robert in Novato:

Anna Warner: I can relate to your 5 Investigates report last night on credit card finance rate increases. Like your guests, I am a long-time Capital One customer who has never paid late and always paid more than the minimum, and periodically pay off the balance to zero. I received a notice saying the rate will more than double in 2010. I called their customer service line and got a scripted answer that all customers are getting the same notice, regardless of their account status.

Please do a follow-up to this report and provide any recourse for customers. If you know of any consumer agencies I can contact or a specific department at Capital One, please email me the information. Maybe if we complain in large numbers, the credit card banks will take notice and change course. Thanks, Robert


From Trisha in Pacifica:

I am not sure if this is where I should direct this note. Thank you for your story about the credit card companies and their greedy, shameful ways. I have had run ins recently with my credit card companies as well, namely Citibank and Bank of America.

I have impeccable records with both companies for 14 and 17 years respectively. I am disgusted and deeply disappointed by the insurmountable greed that these companies are showing in this country amidst a crisis of this magnitude.

These companies received money from our government to keep things flowing and then turned around and hit us hard as well with rates and fees that make these hard times near impossible to bear with higher monthly payments and absolutely no credit to be found unless you are wealthy and don't need it!

The overwhelming lack of faith in our deeply broken system and the helplessness the customer feels to do anything at all to move forward or help themselves through this just adds another thick layer of gloom onto the fear and worry that we already have about what our collective future as a community, country and world have in store for us.

This will cause people like me who had their debt under control to lose control and force more people to default which will then cause the banks to be in more trouble, which will give them an excuse to raise rates again, which will take down another layer of consumers, and the wheel goes round and round. Can you please keep talking? LOUDLY! Again and again.

Shame them into looking at their ways as President Obama says. Make this heard out there over and over and maybe more people will write or call and there will be enough of us rallying to the point that something must be done. Small voices cannot do it alone, we need you!

There is no other way to get the attention of the people who can help stop these greedy financial corporations from taking advantage of us other than you in the media. Please, please help us by amplifying our voices as loudly as you can! Thank you!


From Spence in Danville:

Credit Card rates. I just received notice that my credit card rate DROPPED for 6.00% to 5.25%. I use an on line banking account which pays good returns on ll accounts. I receive more bank services and no or low charges. I've been using them for over a year. Please check it out: EverBank. 


From Erin:

To whom it may concern: Tonight on the 11 o'clock news CBS5 interviewed Capital One and Chase credit card users regarding their interest hikes.

What about the other companies? I have a Target VISA and was notified 2 days before my bill was due in February that Target was dropping my balance on the card to a level that was well below the balance that was already on the card due to my credit score.

Immediately concerned that there was an issue with my credit that I was unaware of, I checked my most recent score only to find that not only was my credit in good standing, but it is actually as good as it has EVER been! (As a side note, I receive all of my statements and regular notifications from Target via email, but they sent this nasty notice via snail mail.)

I am an officer in the US military and would've been in a lot of trouble had my credit not been good enough to open a new card with my bank and transfer the balance of the Target card to that newer card.
 
Erin

(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)