We’ve Decided to RAISE our Borrowers’ Interest Rates

“We appreciate your loan business very much, but because the economy has gotten difficult we’ve decided to TRIPLE your interest rate effective immediately. When your next statement comes, the payment and interest rate will be higher, but don’t panic – it’s just our way of staying profitable so we can continue to serve you…”

OKAY, BEFORE YOU CALL ME IN A PANIC – THIS IS NOT TRUE!!!

But are you one of the lucky credit card owners who have received such a notice recently from your credit card company? With so many banks in trouble because of their poor lending practices – many have decided that the best way to generate some extra revenue is to target their credit card borrowers – even their BEST credit card borrowers.

Forget the fact that you’ve been a good client for YEARS and never been late. Forget the fact that they promised you that low interest rate on that balance transfer “for life”. Forget that your credit score is 800 and you’ve never missed a payment in your life! They have decided that YOU are their solution to all the other stupid lending choices they’ve made.

So, you’ll get the letter that says “We’re changing your terms – tripling your interest rate (or more) and increasing your minimum payment calculation too!” If you don’t accept these changes, your account is immediately closed. Faced with this choice, many of you decided to pay the higher interest rate rather than closing your account – because closing your account would hurt your credit score. Ouch! Rock / Hard Place!

Is there hope in sight?

Maybe. If you follow the financial markets at all, you’ve no doubt noticed that many banking stocks have stabilized and are starting to recover. The news coming out lately suggests that the stimulus money pouring in to these financial institutions is having a positive affect on bank balance sheets. Money is starting to flow through credit markets again.

But if you did get hit with those increased credit card rates, please realize that your credit card company is NOT going to send you one of them letters saying, “Whew! Crisis is over! We’re lowering your rate again!” If you accepted the higher rate – they are happy to let you keep it.

Did you Opt-Out?

Over the past few years, fears of identity theft have prompted many of you to use www.OptOutPreScreen.com to eliminate those pre-approved credit card offers from filling your mailbox. IF you’ve done this, and IF you just got whammied by your credit card company, may I suggest that you remove your name from the Opt-Out list?

Credit card business is VERY profitable to banks – so it won’t be long, as the bank balance sheets improve, before they start mass-mailing low-interest balance transfer offers again. If your name is on the Opt-Out list, you won’t be getting these offers – essentially Opting Out of Better Options.

What do you do Now?

If you did put your name on the Opt Out list at some point, it is very easy to “opt out” of the opt out list again.  On the www.OptOutPreScreen.com website, it is simple to “Opt Out” or “Opt In”.  Enter your info, and couple mouse clicks, and you’re back on the marketing lists again.  Soon, your lonely mailbox will start filling with offers again. 

No one likes junk mail, but when good credit card offers start coming out again, you’ll be glad you took this simple step.

Related Articles:

• Are YOU Spending Wisely, or Emotionally?
• Credit Card Debt
• Payday Loans – Rip Off or Smart Financial Tool?
• Credit Scoring In Plain English
• “SAFETY NET” Credit Scoring Factor

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