This can happen. APR was 8.9%, ok charge up a bal figuring ehh APR is low. Nope!

[Anonymous]

When your balance goes up your FICO goes down and your interest APR can go up.

Possible actions by the CC companies.
$1,000 CL
UTL / APR
0-10% 8.9%
11-30% 14.9%
31-50% 19.9%
51+% 23.9+%

Ok so I got your attention. This is not definite but can happen. So always think what your APR can be with the balance you plan on carrying not the current bal at low UTL. And this is more than likely determined by your score. So just be aware the higher your debt goes, the ARP could follow.

[Anonymous]

They can also lower it too.................BOA lowered my APR and this was when I carried a balance of $800-900 of $1000.00 available credit for a year. Of course my score already sucked about as bad as it could get, so it probably didn't make a difference for me.

Message Edited by siangirl34 on 09-02-2008 03:24 PM

[Anonymous]

same here. I currently have high balances on my target visa and sears mc. So far no rate jack yet. But whos to say what will happen in future.

[Anonymous]

The example % were for over all UTL of credit not per any specific card. Many people reported as they started increasing UTL (over all not just one card) that lenders started to panic a bit raising rates and in some cases closing cards.

[jmbfl]

Way too much of a generalization. RJ'ing is an issuer by issuer situation. So is other AA. It is generally true that having high utilization over a period of time could lead to a rate increase. Or balance chasing. Or account closing. To put an actual table of numbers behind it is just speculative. Every situation is different.

[Anonymous]

It was just possible actions to help people understand what can happen. It's meant to just educate people who might not know carrying high balances can raise their rates and the rate they stated with may not be the rate they end up with due to using the credit carrying a balance.

[score_building]

Thanks for the helpful illustration.  It can be useful even to those who already know what can happen (but are perhaps struggling to repay) to see it spelled out.  Nice reality check for sure.  How did you determine your balance segments and correlated apr increases?

[Anonymous]

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@score_building wrote:

Thanks for the helpful illustration. It can be useful even to those who already know what can happen (but are perhaps struggling to repay) to see it spelled out. Nice reality check for sure. How did you determine your balance segments and correlated apr increases?

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I made them up bases on some score drops for UTL. Each jump in % (roughly estimated no exact) would cause a score drop that might catch the attention of some lenders. This was like you said a reality check so to speak not to work off of. But the other problem too is after the UTL gets up there long enough people who are just barely making min payments could with higher interest have to make larger min payments due to more interest causing them to miss payments. Kinda make one think if it is ever a good idea to allow UTL to get up there?

[score_building]

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ilovepizza wrote:

I made them up bases on some score drops for UTL. Each jump in % (roughly estimated no exact) would cause a score drop that might catch the attention of some lenders. This was like you said a reality check so to speak not to work off of. But the other problem too is after the UTL gets up there long enough people who are just barely making min payments could with higher interest have to make larger min payments due to more interest causing them to miss payments. Kinda make one think if it is ever a good idea to allow UTL to get up there?

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v. cool.  psychologically i think revolvers sometimes hold on to the initial promise of low interest     even as balances rise.   i wonder if there would be significantly fewer card holders likely to revolve if a chart like yours was posted in the t&c's

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ilovepizza wrote:

 Kinda make one think if it is ever a good idea to allow UTL to get up there?

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It sure does!  Nice work, thanks again

[Anonymous]

well, I agree - *if* sufficient additional available credit isn't available on other cards as a cushion to improve util.

I would say maybe it's a little cynical, but not inaccurate of what might happen in the light of the current credit environment.