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Valued Contributor
usmc58555
Posts: 1,673
Registered: ‎02-18-2009
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Re: Raising of Minimum Payment (Chase)


mixed wrote:
The issue here for me is that I have other cards that are at a higher rate and would prefer to pay them off first. 

Really not their concern. Credit is about the only thing left in the US that does business with customers on their terms, not the other way around

 

YEARS AGO THE BASE MINIMUM WAS 5%- IN THE 1990s IT WAS REALISED THAT A LOWER RATE MADE PEOPLE CHARGE MORE.

 

ITS OBVIOUS  SOME COMPANIES WANT PEOPLE TO CHARGE LESS/HAVE LESS OF A BALANCE.

 

They could have lowered your CL

 

They could have increased your rate

 

Instead they increased your minimum.

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Established Contributor
Revike
Posts: 720
Registered: ‎05-04-2007
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Re: Raising of Minimum Payment (Chase)

[ Edited ]

usmc58555 wrote:

mixed wrote:
The issue here for me is that I have other cards that are at a higher rate and would prefer to pay them off first. 

Really not their concern. Credit is about the only thing left in the US that does business with customers on their terms, not the other way around

 

YEARS AGO THE BASE MINIMUM WAS 5%- IN THE 1990s IT WAS REALISED THAT A LOWER RATE MADE PEOPLE CHARGE MORE.

 

ITS OBVIOUS  SOME COMPANIES WANT PEOPLE TO CHARGE LESS/HAVE LESS OF A BALANCE.

 

They could have lowered your CL

 

They could have increased your rate

 

Instead they increased your minimum.


One technicality (regarding the above part I underlined) - since the affected accounts had balances consisting of promo-rate BTs, the rate could not be increased unless the customer defaulted. Otherwise, I agree with your point.

 

In general, customers need to be more paranoid/cautious about potential vulnerabilities. To my knowledge, CCCs have always been free to set whatever minimum payment percentage they choose, for their own reasons, and are not required to warn customers of minimum payment percentage changes.

 

I've had accounts with minimum payments of 1%, 1.5%, 2%, 3%, and 5%. If I carry a significant balance (such as a BT) with a CCC who currently sets minimum payment at 1% or 1.5%, I know that I'd better have a contingency plan in case they decide to bump the minimum.

 

I currently have an 18-month 0% BT with CapOne that has a 1% minimum payment. Prior to the BT, the account had a minimum payment of 3%. CapOne didn't lower the minimum because they are kind and generous souls, they did it because they expect to entrap some customers who could find themselves without exit strategies when the promo rate expires.

 

One other thing - the new 2010 regulations include a provision about applying payments to the highest-interest balance first. However, the specific wording has a big loophole - only the payment in excess of the minimum is affected. So, if someone has an account with part of the balance being a 2.99% BT and part of the balance being purchases at a 12.99% APR, and only pays the minimum, none of their payment will be applied toward the purchase balance. And the higher the minimum, the less chance that the high-APR balances will get paid down. I think we will see more 3%-4%-5% minimum payment percentages when banks decide to exploit this loophole ...

Message Edited by Revike on 06-25-2009 07:51 PM
Established Contributor
Susyquk
Posts: 504
Registered: ‎03-27-2009
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Re: Raising of Minimum Payment (Chase)


Revike wrote:

usmc58555 wrote:

mixed wrote:
The issue here for me is that I have other cards that are at a higher rate and would prefer to pay them off first. 

Really not their concern. Credit is about the only thing left in the US that does business with customers on their terms, not the other way around

 

YEARS AGO THE BASE MINIMUM WAS 5%- IN THE 1990s IT WAS REALISED THAT A LOWER RATE MADE PEOPLE CHARGE MORE.

 

ITS OBVIOUS  SOME COMPANIES WANT PEOPLE TO CHARGE LESS/HAVE LESS OF A BALANCE.

 

They could have lowered your CL

 

They could have increased your rate

 

Instead they increased your minimum.


One technicality (regarding the above part I underlined) - since the affected accounts had balances consisting of promo-rate BTs, the rate could not be increased unless the customer defaulted. Otherwise, I agree with your point.

 

Message Edited by Revike on 06-25-2009 07:51 PM

Ha, I had a friend call me today telling me that Chase had decreased their limit to $5000 - they had a balance transfer on there fixed at 1.99% for life and a current balance of $4998 (their previous limit was $8000 which they had trf'd the full amount to just 6 months ago - in the last six months they paid back $3000 of that and have available credit elsewhere of $14,000 just had moved all debt to this one card to take advantage of the low rate)

 

Add on the interest this month and he is now with a balance of  $5006 - putting him over his limit, in excess of 100% UTL on ths card and meaning he has an over limit fee added on to that balance too, in addition they want a 5% payment on the account and have told him his promo rate will no longer apply(not actually a problem for the 5%, he has been paying more than that each month anyway - he's just pissed about the over limit charge since he would not have been over the limit had it not been for their decrease and now his rate will rocket too. )

 

lol - he PIF today and sd'd his card, but he is one of the lucky ones who can afford to do that.

Member
mixed
Posts: 9
Registered: ‎11-30-2007
0

Re: Raising of Minimum Payment (Chase)

To clarify, my credit rating is good, and I am a never late - never missed in an over 20 year credit history.  My complaint would not be a 5% minimum payment if that is what I started with when I borrowed the money.  I actually believe this is not about me at all, but an attempt of Chase to recapitalize because of their own weaknesses. While my concerns are about losing an a good opportunity to help me pay down my debt high interest rate first "may not be their concern" keeping customers and being a good corporate citizen should be and I shouldn't have my terms changed because they missmanaged their money either.
Senior Contributor
txjohn
Posts: 4,214
Registered: ‎09-12-2008
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Re: Raising of Minimum Payment (Chase)


mixed wrote:
Today I recieved a notice that begining in August Chase is increasing my minimum payment from 2% to 5%, I have many for the life of the loan balance transfers on this card with very low rates and rather pay off some more expensive cards first.   Is there anything I can do?  I called them and told them I rather close the card and and not have the change take effect.  They say it doesn't matter whether I close it or not they are raising my minimum payment. Would the Better Business Burea be of use, or calling my national representatives?  If every card more than doubled my payments I could be in trouble.

 

"Minimum Payments" is not your "expected" payment.  CC's provide a minimum payment for convenience and the ability to manage your cash flow.  However, CC's are not designed to be long term pay outs.

 

One of the biggest problems with CC's is that people who pay minimums only are going to be making payments for decades, sometimes 30 to 40 years, regardless of the interest rate.

 

Legislation and regulators have been pressuring CCC's to raise the percentage of balance for minimums in order to make sure CC's don't become long term "mortgages" especially when you combine low minimums with relatively high interest rates.

 

There is nothing you can do about this, except pay the amount due.  If you fail, you will find yourself rate jacked, credit ruined and accounts possibly closed.

 

Look for ways to come up with cash, like selling things (garage sale, ebay sale, craigslist, etc).  Got a car you don't really need, or motorcycle, boat.  Things lying around that you don't use, don't need, are a luxury you can live without, in the attic, garage, closet, under bed on the counters and possibly in PAID storage?  You would be amazed how much money some people have raised by selling these type of items.

 

You might consider another part time job.  Any additional income will go a long way toward paying down debts and meeting the new higher minimums.

 

ONE GOOD THING about what Chase has done:  The raised minimums represent additional PRINICPAL payments, not just additional interest and fees.  So, this is basically a forced rapid repayment.  At least the extra payment amounts are going to reduce debt and not just lining Chase's pocket even more.

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Valued Contributor
usmc58555
Posts: 1,673
Registered: ‎02-18-2009
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Re: Raising of Minimum Payment (Chase)

[ Edited ]

mixed wrote:
To clarify, my credit rating is good, and I am a never late - never missed in an over 20 year credit history.  My complaint would not be a 5% minimum payment if that is what I started with when I borrowed the money.  I actually believe this is not about me at all, but an attempt of Chase to recapitalize because of their own weaknesses. While my concerns are about losing an a good opportunity to help me pay down my debt high interest rate first "may not be their concern" keeping customers and being a good corporate citizen should be and I shouldn't have my terms changed because they missmanaged their money either.

The customer is not always right.

 

The best interests of a specific individual or group of cutomers may not be in the best interest of a company.

 

[There are people out there that have life ending diseases and medical conditions that no research whatsoever is being done to cure as there is not enough patients to pay for the research and development for the drug]

 

Being a good corporate citizen will not stop you from declaring a BK and ceasing functioning. I have NEVER been outside a going out of business sale and heard people walking around muttering "If only they had raised prices more I still would have bought..."

 

Your terms you signed stated they could change for any reason. So in effect your "terms" never changed.


Have you ever thought that you might now be someone they see as having missmanaged "their" money by extending you credit as they have in the past?


OK Funny story: My roommate was a GM for a Ground Round years ago. Got a call at 6:20PM. All customers need to be out by 6:30PM all employees by 6:45PM. NO questions no answers. People were irate "We are going to call and complain," and "How can you do this to us." His reply?

 

"The company no longer exists, there is no one to call, we do not have to worry about making you happy as the doors are being shut. Leave now before I have to call the police"


I think credit card companies are making some hard decisions to keep themselves in business. Sorry if that differs from any one person's world view.


With your great record it should be easy to find another BT, right?

Message Edited by usmc58555 on 06-26-2009 08:54 AM
Signature line begins:
Credit is not a right, but a business transaction, one that takes into account risk, and charges accordingly based on that risk.
Your credit score is an aspect of your credit profile. Important? yes but just an aspect. Contributing/supplemental information determines the finer point of the deal. Ask any question, respect me not to get mad if the answer is not the affirmation you are looking for,
Super Contributor
marty56
Posts: 5,679
Registered: ‎10-06-2007
0

Re: Raising of Minimum Payment (Chase)

A few years back when I had a ton of CC debt, Chevron (GEMB) would increase the monthly payment % when I got close to my limit which at the time I didnt like but looking back they were doing me a favor.

 

Having to pay more each month when revolving a balance might finally help to motivate someone to get out of CC debt.  It took a lot more pain to get me out of CC debt so if the increase works, then it was worth it.

09/12/2013 FICO: EQ: 772 EX:813 TU:752
New Contributor
22_broke_and_in_debt
Posts: 58
Registered: ‎09-23-2008
0

Re: Raising of Minimum Payment (Chase)

This doesn't surprise me with Chase. They are an absolute debacle, and an embarrasment to the professional standard of banking that most people come to expect from the business world. There is no doubt in my mind as to what got them into the situation they're in. I could rant for an hour on them, but I won't...

 

Anyway, Chase and AMEX seem to be leading the pack when it comes to disappointing their best and most loyal customers. My mother put it into perspective the best:

 

"They know they can't get blood from a stone. They are going to raise the rates and payments on good customers because they know they can get it. They're not going to bother with the person who is truly in trouble, and has nothing left to lose; they're going to sucker the one who pays in earnst. This bill for 2010 is a joke, and like putting a band-aid on a gun shot wound, it's useless."

 

This was while she was complaining about AMEX, and I was complaining about Chase. Maybe consider a consolidation loan with a fixed APR and payment? If you get direct deposit it might be easier to just DD a portion of the payment each time you get paid, then you won't feel it as much. It's just a suggestion, and I wish you the best of luck with them.

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Get a good job with more pay,
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Grab that cash with both hands,
and make a stash.
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...today.
But if you ask for a rise, it's no surprise that they're
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Member
mixed
Posts: 9
Registered: ‎11-30-2007
0

Re: Raising of Minimum Payment (Chase)

Ok, for those interested in a practical solution for a real person with budgetary and time limits.  Here is what I decided to do.  With a combination of balance transfer and my property tax rebate I am going to pay this card half off in the coming months before or as the policy change takes hold.  My monthly payments will still increase, but not more than double.  The new minimum payment will be similar to what I paid before because I usually round up to the nearest $10 above the minimum anyway (even on my lower rate cards [others I pay much more]).  The remaining balance will still be at the great "life of the loan"rate and I will have payments I can manage.  When I pay this card off most likely I will let my Chase card die of inactivity, because of higher underlying rates Chase charges and how they treated me over the years.
New Visitor
Sensibility
Posts: 3
Registered: ‎06-27-2009
0

Re: Raising of Minimum Payment (Chase)

I (and thousands of other cardholders apparently) received such a notice today, too.  We are not alone and a lot of good, responsible Americans (who helped bail out Chase wth TARP funds) will be harmed.  

 

http://www.consumeraffairs.com/credit_cards/chase_credit_cards.html

 

 

 I also called Chase to complain.  The 3 Chase representatives and supervisors I spoke with explained they were doing this to everyone and had nothing to do with credit history or standing. They explained that they were doing this because of the new credit legislation.  One even said they were doing it to comply, which I find hard to believe.  They were nice and I felt bad for them, one even shared that they were being inundated with calls and she felt badly.

 

What I dislike most about this is that it is essentially usury and a slap in the face to lawmakers who meant to protect people with the upcoming legislation.  If you read the consumer affairs article, it appears the people effected are those who took advantage of low fixed rates to pay off larger debts (advice often given by financial planners and resources available on this site.)  Now they want their money back before the new legislation restricts them from increasing rates, etc.  If this isn't predatory lending practices, I don't know what is.

 

BE CAREFUL of the options they present to you if you call.  The first person I spoke to told me she could lower my payment but would close the account. Upon questioning this option, it turns out  this was considered a "settlement" and would hurt my credit as I would technically be in default.  I'm glad I asked.  I didn't need credit help or settlement, I just wanted a reasonable payment.  

 

They also offered me a fixed payment and APR (higher than the promotional I have now), but I declined to think about my options.  I'm probably better off just paying off the balance and being done with this institution.

 

I also plan to pursue this with my congressmen and regulators as it is a direct result of the legistlation that was passed and I truly believe it to be a predatory lending practice.  While I see some comments here that it is legal, but legal doesn't make it right or ethical.  Since Chase helped themselves to the TARP funds they should be held accountable for the negative impact they are going to have on good, creditworthy citizens (not to mention the American economy).  

 

Polonius couldn't have been more relevant " ...do not forget, stay out of debt" 

 

 

 

 


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