Reply
New Member
Forward
Posts: 3
Registered: ‎04-18-2007

APR's all going up on cc's due to credit to debt ratios?

Dear Forum Members:
 
A number of my credit cards are sending notifications of increses in my APR (drastic). After conversing with the cc companies I have been told that it's because my credit to debt ratio is too high.
 
I have never been late with a payment and have always paid more than the minimum. Additionally, I have had great credit for a number of years now (amex plat etc)
 
Is there anything I can do to stop this snowball effect? Other than paying down the cards that is as I do not currently have enough cash.
 
I can't believe they can do this!!!!!!!!!!!!!!
 
Any help or insight would be greatly appreciated.
 
Best regards,
Forward
Senior Contributor
Noah_Bodie
Posts: 4,635
Registered: ‎03-11-2007

Re: APR's all going up on cc's due to credit to debt ratios?

Be thankful they didn't close your account. BOA has been exercising their universal default clause and closing accounts that were current.
 
U.S. Senator Carl Levin recently held hearings. You might consider sending his office an Email or letter.
Moderator Emeritus
Brammy
Posts: 5,436
Registered: ‎03-10-2007

Re: APR's all going up on cc's due to credit to debt ratios?



Forward wrote:
Dear Forum Members:
 
A number of my credit cards are sending notifications of increses in my APR (drastic). After conversing with the cc companies I have been told that it's because my credit to debt ratio is too high.
 
I have never been late with a payment and have always paid more than the minimum. Additionally, I have had great credit for a number of years now (amex plat etc)
 
Is there anything I can do to stop this snowball effect? Other than paying down the cards that is as I do not currently have enough cash.
 
I can't believe they can do this!!!!!!!!!!!!!!
 
Any help or insight would be greatly appreciated.
 
Best regards,
Forward


 
Are your cards maxed or close to their limits?  This doesn't sound like UD to me it like a case of your lenders reducing their exposure.  If you carry high balances on any card for any length of time you will eventually get that notice.  I hate to hear that's happening to you though. It happened to me but luckily I had enough money in the bank to tell them where to put the card.  I didn't understand how that worked and just assumedthat as logn as I didn't go over my limit and paid on time everything was hunky dory.  They really should have more specific reasons in those T&Cs
 
Anyway, If you can't pay the cards off and it looks like, from the recactions of your creditors its been a longterm thing, naybe 6 mos, you might  try and get a loan from your bank.  I don't know about BTing it to another card as they will see the same thing on your report that you creditors are reacting to.  If they see a particular time frame with no noticible reduction in the amount owed they will turn you down for the same reasons your current creditors are rate jacking you.
 
That being said, time to cut back and buckle down on getting that debt under control.  even if it means paaying minimum plus five and freezing the cards to keep from using the,  DO NOT ADD ANYMORE TO YOUR BALAMCES!!!!

Senior Contributor
Noah_Bodie
Posts: 4,635
Registered: ‎03-11-2007

Re: APR's all going up on cc's due to credit to debt ratios?

kd
New Member
kd
Posts: 5
Registered: ‎04-18-2007

Re: APR's all going up on cc's due to credit to debt ratios?

This is starting to happen to me after I charged over Chase's imaginary comfort limit. My rate increased from 7.9 fixed to 22.24 in one month with no late payment ever. By the time I called, they said it was too late to close account at 7.9%. Told me to take up the battle with the post office. Bank of Am account is inching up as well. I have always been comfortable managing my high balance with predictable payments, but feels like the banks are forcing me to contemplate counseling & dmp!
Senior Contributor
Noah_Bodie
Posts: 4,635
Registered: ‎03-11-2007

Re: APR's all going up on cc's due to credit to debt ratios?

New Member
Forward
Posts: 3
Registered: ‎04-18-2007

Re: APR's all going up on cc's due to credit to debt ratios?

[ Edited ]
Thanks for the help.
 
Get readt to hold on to your seat!
 
B of A      26895/29000           APR 13.9
B of A      8856/9500               APR 22.9 (just went up from 7.9)
Amex      8708/10000              APR 3.99 
HSBC    


Message Edited by Forward on 04-19-2007 08:55 AM
New Member
Forward
Posts: 3
Registered: ‎04-18-2007

Re: APR's all going up on cc's due to credit to debt ratios?

[ Edited ]
Thanks for the help.
 
Get ready to hold on to your seat!
 
B of A         2600/29000   APR 13.9
B of A         8800/9500     APR 22.9 (just went up from 7.9)
B of A              0/9500      APR 22.9 (just went from 7.9) (Bal tran to Amex Blue below)
Amex Blue   8708/10000 APR 3.99 
HSBC          3800/5000   APR 2.99
CITI             9184/10300  APR 13.49
Chase         8600/9500    APR 7.99 (Just closed as they wanted to raise to 22.9)
 
Sorry about all of the edits (kept hitting tab). Well, bottom line is I am using 90%of my credit and not able to open other cards. Once again keep in mind that I earn a six figure salary but can not pay dowm now. Also, I have never missed a payment and always pay more than min.
 
Is there a way to stop the snowball effect?
 
It appears that my only alternative is to reject the increase but after rejecting the account is noted closed by me and then I have even less avaialble credit.
 
Just like to banks to charge consumers more of what it is apparent they don't have enough of in the first place!!!!!!!!
 
Best,
Forward


Message Edited by Forward on 04-19-2007 09:07 AM
Moderator Emeritus
Brammy
Posts: 5,436
Registered: ‎03-10-2007

Re: APR's all going up on cc's due to credit to debt ratios?



Forward wrote:
Thanks for the help.
 
Get readt to hold on to your seat!
 
B of A      26895/29000  APR 13.9
B of A   8856/9500     APR 22.9 (just went up from 7.9)
Amex Blue 8708/10000 APR 3.99 


 
Yep High utilization is a reason for issuers to freak.

Moderator Emeritus
masdeocho
Posts: 2,050
Registered: ‎04-17-2007

Re: APR's all going up on cc's due to credit to debt ratios?

Check the fine ugly print of your credit card agreement.  It probably says that they can change the terms at any time for any reason, provided they give you 2 weeks' prior written notice. (Your choices then are to accept the terms or close the account.)  So they don't even need a reason like high utilization to jack your rates up, but it surely could prompt them to do so.
-----------------
Bartender, bring another round of FICOtinis please!

9.4.2011: TU 805. EQ 815.

myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+