@UncleB wrote:
My understanding is that Universal Default is no longer around in the sense that they can arbitrarily (and permanently) raise your APR to 29.99% (or higher) only because you have problems with another lender, but they can (and do) still CLD, and in extreme cases simply close the account.
"Back in the day" having all your 10% and 12% accounts permanently changed to 29.9% because an account you cosigned for got in trouble was the beginning of the end for many folks. For many people, it was literally impossible to recover once the 'Universal Defaults' started, and generally once there was one, the others would follow. A person could be financially stretched, but 'OK', then overnight the monthly interest charge was suddenly more than even the minimum payment (I had one card where this was the case). It was a nightmare for many people, and it was fundamentally unfair - you weren't even able to close the account yourself with the old APR. At least now when they close the account, you get to keep the old terms.
Right, the CARD Act banned Universal Default (at least on current balances), any APR changes had to be based on actions on that card (such as paying late) But as Uncle B says, a few lates on card A means your score drops, and the issuer of card B decides you are a risk and CLDs you. They didn't raise your APR based on the lates on A, but......
