Bank of America Raises Credit Card Rates
Following similar moves by other banks, Bank of America just announced plans aimed at boosting its bottom line, in part by raising interest rates on many of its balance carrying customers. According to the WSJ, any B of A credit card holder who carries a balance currently below 10% will see their rate jump to double digits beginning with their June statements. The exact number of affected customers is not being released, but estimates range as high as four million of Bank of America’s 70 million credit card customers.
Consumers do have the option of notifying Bank of America, opting out of the change, and keeping their current interest rate, but that requires making no new purchases on their card. Any new charges would cause the new, higher rate to apply to the entire balance.
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The banking industry has no fear and acts on the principle that there is no saturation point for raising fees and rates on consumers. Your choice, pay the higher rate or don’t use the card.
Pay off the card and stop using it is the nightmare no bank wants to face. That would force the banks to become more competitive and lower rates. In other words benefit the consumer and not the share holder.
Radical idea, no. It is more of a practical idea.
Try it.
Interestingly, I found out that Bank of America will settle your full debt with you for 60% of the balance. You need to close your card when you’re paid off, and you need to have the cash on hand, but that’s one way to go. I read about this possibility the other day in Bankruptcy 301 –worth checking out.
B of A hits you with the “double whammy”: “Please note the finance charges are added to your monthly
payment, and are also deducted from your credit limit because they are part of your account balance.” They’re pretty slick, no wonder they’re making “billions”.