Hello Everyone, I think this is my first time to post but thought I'd pass along something that recently happened to me with Advanta. I did a balance transfer to them roughly a year ago for a bit lower interest rate. This is a business credit card but in my name. I'm the only card holder. I was not so much as a day late on any monthly payment. I often paid more than the minimum. Nothing changed on my credit report, either. So to say I was shocked when I received a notification saying they were going to increase my interest rate from 9.9 to 25.9, would be a huge understatement. I thought surely there was an error somewhere. I called and spoke to customer service who could not tell me why my rate was increased so I then asked to speak with his supervisor. "Glen" the supervisor came on and asked how he could help me. I explained the notification and my shock and asked him to explain to me what was going on. He said, at first, that it was based on several factors such as card usage, credit scores, etc. I told him that I knew there had been no changes in my scores and asked what exactly "card usage" meant since I had only put 3 items on the card for a total for all 3 of less than $100. Glen proceeded to tell me that was the biggest part of the problem. I wasn't using my card enough. When I asked if I understood him correctly to be saying I was being penalized because I wasn't running my credit card up, he said, "You aren't being penalized but since it appears you're mainly using your card to pay down the debt, you have to understand that we need to make a living, too." I think my head exploded and I told him he had just lost this account and he did. I did a balance transfer back to my old card for an even lower rate than I had with Advanta. No, I have not closed the account. Is this legal? Has anyone else had this experience with Advanta? I give them the biggest thumbs down there is!!! Linda
People keep forgetting that CC companies are not here to be our friends. They are here to make money. That's the game and you need to stay on top of it. Check APR's monthly and keep up with BTs. They will raise your rates, then after you BT away, they will lower them to get you back. That's one advantage of having lots of CCs people never understood, the part where you have more odds of better BT APRs sitting in the sock drawer.
I read on another forum that they are doing this to lots of their business customers across the board. Many who are like you. They don't have any baddies, recent dips in their scores, or bad history with them. Nothing to warrant jacking their rates.
Was the notification on a small slip of paper or letter form? If it wasn't a letter, I wouldn't take it personally.
I think they are ratejacking to make more money. Luckily you were able to BT to another card. I'm sure many others will follow suit. Hopefully lose so much business from BTs to other cards that, they'll think twice about doing this in the future. But I suspect not everyone has that option to just BT and they'll be stuck paying this outrageous rates. It may just be business, but it's not nice.
Yesterday, I had a similar experience with Advanta, who changed my rate for what seems to be no reason at all. They changed my rate from 7.99% to 20.59% with no late payments at all. Their rep claimed they sent me a letter 3 weeks ago that I did not receive. I electronically paid the balance in full and will not use the card until the problem is resolved. A perfect example of a reason to have extra credit cards.
I originally responded to their offer 33 months ago to get a new card for my new LLC and balance transfer (at 0%) money that was on the existing card at 10%. This gave me a true business card and a balance that did not appear on my personal credit report. I always paid more than minimums, usually 2-10 times the minimum. When the card was down to half of the original balance, I started using it as my normal business card, paying the balance as convenient. Sometimes 2-3 times minimum, sometimes paid in full. After using it as a normal card, the total balance never reached half of the credit limit and all payments were paid on time, electronically. Last payment was $675 against a balance of $2300, which is about 10 times minimum againt a balance that is 15% of the limit. That is about typical so I paid $16 interest the previous month. I was considering using the card to pay for half a forklift, since the 7.99% interest was only 1.5% more than a loan from the dealer and requires no paperwork. It also has flexible payments, which can be nice in a business environment.
My FICO has ranged from 712 to 758 during this time as I have used various low/zero interest offers on personal cards to pay down business debts that did not show on my personal credit report. For example, I used a 3.99% for life of the balance offer to pay off a 9% business truck loan, which is an outrageous rate for a truck loan but was the best I could get for that business when it was brand new. That balance now appears on my personal account and was a 20 point hit. Still the current 723 score should not alarm anyone. The only baddie on my report is a 30 day late that is 6.5 years old.
This is the worst treatment that I have received from a credit card company. I am completely amazed. What are they thinking?
I luckily have a fixed balance transfer rate of 2.9 for life, but my purchase rate has been increased 2 now sitting at 34.99!!! so I will never use the card, customer service says they changed there lending critieria and based on this account and credit blah blah I'm a new risk. funny is they keep increasing the cl every 6 months!
When CC companies see that you carry balances for a certain period of time, they RJ you to make more money. It doesn't matter if you pay more than the minimum. As long as you carry a balance, they can RJ you to whatever they see fit. Afterall, they are making more money off of you. And, those balance transfer offers sound really good until you realize you can't pay off the balance by the end of the introductory period. It's best to keep up with those BTs and if you must carry a balance, don't do so for an extended period of time.