topic Re: Discover It APR Reduction Double Dip in Credit Cards

Discover It APR Reduction

Jordan23ww — Tue, 26 Oct 2021 16:56:08 GMT

On Sunday night I read a comment from @lovelife2 in a post saying how they chatted with Discover and had their APR reduced. I decided to try this too! I started a chat. I sent a statement, "I would like to see if I'm eligible to have my APR reduced"? I got a prompt that someone would be with me soon.

I must've waited 10 minutes when suddenly I was kicked out the chat. I tried 3 times to launch a new chat but I couldn't. So I called Discover and got transferred to the appropriate department. They told me great news you're eligible to have your APR reduced from 20.99% to 17.24%. I said awesome, I'll accept that.

About 10 minutes later I got 3 notifications on my phone from a Discover agent. They were saying they got my request and are checking to see if I'm eligible to have the APR reduced. Another asking if I was still there. Then lastly one saying unfortunately I wasn't eligible but I'd receive a letter in the mail explaining why.

So 2 days later I wake up to an email that there are secured messages on my account. I go to read it and the 1st is saying unfortunately we were not able to approve your request to have my APR reduced. Then the 2nd one was informing me my APR was reduced from 17.24% to 13.99%! So I got 2 APR reductions in the last 48 hours. I unintentionally got an APR "double dip"!

Re: Discover It APR Reduction Double Dip

VanderSnoot — Tue, 26 Oct 2021 12:04:56 GMT

Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.

Re: Discover It APR Reduction Double Dip

Jordan23ww — Tue, 26 Oct 2021 14:20:54 GMT

@VanderSnoot wrote:
Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.

@VanderSnoot Thank you! So are you saying it's not 13.99%? I'm confused.

Re: Discover It APR Reduction Double Dip

unsungivy — Tue, 26 Oct 2021 14:55:16 GMT

@Jordan23ww wrote:
@VanderSnoot wrote:
Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.
@VanderSnoot Thank you! So are you saying it's not 13.99%? I'm confused.

Correct. It's not 13.99%... it's 13.99% PLUS PRIME. When you add in prime, it's 17.24%

Re: Discover It APR Reduction Double Dip

VanderSnoot — Tue, 26 Oct 2021 15:13:39 GMT

Agreed. Variable APRs for credit cards are usually calculated as Prime + a fixed percentage. Prime fluctuates weekly; you can check the current rate on Bankrate. (This type of calculation is true for most lending. When I worked for a commercial lender, we used LIBOR + an internally set fixed rate.)

The mailer says:

We're pleased to lower your Annual Percentage Rate (APR) to a variable* standard APR of Prime Rate + 13.99%, currently 17.24% for new purchases.

Your new APR is Prime Rate + 13.99%. If you look at Bankrate, you'll see that the current Prime Rate is 3.25%.

3.25% + 13.99% = 17.24%

Your current APR for new purchases is 17.24%. It is variable and will change, but will always be 13.99% above Prime.

Re: Discover It APR Reduction Double Dip

Jordan23ww — Tue, 26 Oct 2021 19:54:20 GMT

@unsungivy wrote:
@Jordan23ww wrote:
@VanderSnoot wrote:
Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.
@VanderSnoot Thank you! So are you saying it's not 13.99%? I'm confused.
Correct. It's not 13.99%... it's 13.99% PLUS PRIME. When you add in prime, it's 17.24%

@unsungivy Oh wow! Thank you for clarifying! This is such a weird way to write this. It would've been better just to say your new rate is 17.24%! Who even talks like you this? "I'll be by to pick you up at 7:15 plus 15 minutes (7:30)!" 😂🤣😂 Oh well! Thank you again!

Re: Discover It APR Reduction Double Dip

Jordan23ww — Tue, 26 Oct 2021 19:59:30 GMT

@VanderSnoot wrote:
Agreed. Variable APRs for credit cards are usually calculated as Prime + a fixed percentage. Prime fluctuates weekly; you can check the current rate on Bankrate. (This type of calculation is true for most lending. When I worked for a commercial lender, we used LIBOR + an internally set fixed rate.)

The mailer says:
We're pleased to lower your Annual Percentage Rate (APR) to a variable* standard APR of Prime Rate + 13.99%, currently 17.24% for new purchases.

Your new APR is Prime Rate + 13.99%. If you look at Bankrate, you'll see that the current Prime Rate is 3.25%.
3.25% + 13.99% = 17.24%
Your current APR for new purchases is 17.24%. It is variable and will change, but will always be 13.99% above Prime.

@VanderSnoot thank you for this explanation! You learn something new every day! I had never heard of APR explained like this (Prime +) before today and I've had credit cards for 26+ years!

Re: Discover It APR Reduction

FinStar — Tue, 26 Oct 2021 20:20:23 GMT

@Jordan23ww wrote:
@unsungivy wrote:
@Jordan23ww wrote:
@VanderSnoot wrote:
Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.
@VanderSnoot Thank you! So are you saying it's not 13.99%? I'm confused.
Correct. It's not 13.99%... it's 13.99% PLUS PRIME. When you add in prime, it's 17.24%
@unsungivy Oh wow! Thank you for clarifying! This is such a weird way to write this. It would've been better just to say your new rate is 17.24%! Who even talks like you this? "I'll be by to pick you up at 7:15 plus 15 minutes (7:30)!" 😂🤣😂 Oh well! Thank you again!

It's a regulatory requirement. Makes sense since they are clearly stating what the index (prime) rate is + Discover's lending rate. Lenders have to provide these disclosures as part of any changes to your APR. It may look weird, but it be like that sometimes.

Re: Discover It APR Reduction

VanderSnoot — Tue, 26 Oct 2021 20:23:31 GMT

@FinStar wrote:
@Jordan23ww wrote:
Oh wow! Thank you for clarifying! This is such a weird way to write this. It would've been better just to say your new rate is 17.24%! Who even talks like you this? "I'll be by to pick you up at 7:15 plus 15 minutes (7:30)!" 😂🤣😂 Oh well! Thank you again!
It's a regulatory requirement. Makes sense since they are clearly stating what the index (prime) rate is + Discover's lending rate. Lenders have to provide these disclosures as part of any changes to your APR. It may look weird, but it be like that sometimes.

Remember the LIBOR fixing scandal? No one made a fuss because consumers understood neither what it meant nor how it affected them. So, @Jordan23ww , you've learned valuable info today!

Re: Discover It APR Reduction Double Dip

unsungivy — Tue, 26 Oct 2021 21:38:48 GMT

@Jordan23ww wrote:
@VanderSnoot wrote:
Agreed. Variable APRs for credit cards are usually calculated as Prime + a fixed percentage. Prime fluctuates weekly; you can check the current rate on Bankrate. (This type of calculation is true for most lending. When I worked for a commercial lender, we used LIBOR + an internally set fixed rate.)

The mailer says:
We're pleased to lower your Annual Percentage Rate (APR) to a variable* standard APR of Prime Rate + 13.99%, currently 17.24% for new purchases.

Your new APR is Prime Rate + 13.99%. If you look at Bankrate, you'll see that the current Prime Rate is 3.25%.
3.25% + 13.99% = 17.24%
Your current APR for new purchases is 17.24%. It is variable and will change, but will always be 13.99% above Prime.
@VanderSnoot thank you for this explanation! You learn something new every day! I had never heard of APR explained like this (Prime +) before today and I've had credit cards for 26+ years!

I think you'll find that if you look at the "rates and fees" page of just about any CC that this is how they state it, and this is why your APR goes up and down slightly over the years... because that "prime" part varies, and that's what makes it a "variable" rate, instead of a "fixed" rate. You know when you can choose between getting a fixed rate on a loan and a variable rate? That's what the difference is... you're choosing whether or not to gamble that that "prime" part stays low enough that the total is less than the "fixed" % would be.

Mouseover any of my CC in my signature, and you will see that I have them stated in that format. The exception to this is AOD which is a FIXED rate, which is very unusual.

Re: Discover It APR Reduction Double Dip

Jordan23ww — Tue, 26 Oct 2021 22:17:19 GMT

@unsungivy wrote:
@Jordan23ww wrote:
@VanderSnoot wrote:
Agreed. Variable APRs for credit cards are usually calculated as Prime + a fixed percentage. Prime fluctuates weekly; you can check the current rate on Bankrate. (This type of calculation is true for most lending. When I worked for a commercial lender, we used LIBOR + an internally set fixed rate.)

The mailer says:
We're pleased to lower your Annual Percentage Rate (APR) to a variable* standard APR of Prime Rate + 13.99%, currently 17.24% for new purchases.

Your new APR is Prime Rate + 13.99%. If you look at Bankrate, you'll see that the current Prime Rate is 3.25%.
3.25% + 13.99% = 17.24%
Your current APR for new purchases is 17.24%. It is variable and will change, but will always be 13.99% above Prime.
@VanderSnoot thank you for this explanation! You learn something new every day! I had never heard of APR explained like this (Prime +) before today and I've had credit cards for 26+ years!
I think you'll find that if you look at the "rates and fees" page of just about any CC that this is how they state it, and this is why your APR goes up and down slightly over the years... because that "prime" part varies, and that's what makes it a "variable" rate, instead of a "fixed" rate. You know when you can choose between getting a fixed rate on a loan and a variable rate? That's what the difference is... you're choosing whether or not to gamble that that "prime" part stays low enough that the total is less than the "fixed" % would be.

Mouseover any of my CC in my signature, and you will see that I have them stated in that format. The exception to this is AOD which is a FIXED rate, which is very unusual.

@unsungivy Oh nooooo, I know about fixed rates and variable rates. I just don't ever remember reading the wording "prime +" before today. Maybe I just overlooked it or it went in one ear and out the other. My eyes maybe just zoomed in on APR instead. My understanding has always been when applying for a new card, for example, "Jordan you've been approved for ABC Visa and your APR is 18%". Not ..."Jordan you've been approved for ABC Visa and your prime + APR is...".

Thanks again to you and others for taking the time to explain this to me! I appreciate it!

Re: Discover It APR Reduction Double Dip

CreditInspired — Tue, 26 Oct 2021 22:55:32 GMT

@Jordan23ww wrote:
@unsungivy wrote:
@Jordan23ww wrote:
@VanderSnoot wrote:
Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.
@VanderSnoot Thank you! So are you saying it's not 13.99%? I'm confused.
Correct. It's not 13.99%... it's 13.99% PLUS PRIME. When you add in prime, it's 17.24%
@unsungivy Oh wow! Thank you for clarifying! This is such a weird way to write this. It would've been better just to say your new rate is 17.24%! Who even talks like you this? "I'll be by to pick you up at 7:15 plus 15 minutes (7:30)!" 😂🤣😂 Oh well! Thank you again!

Good one!!! I have got to use it 🤣😂😆

Re: Discover It APR Reduction Double Dip

Jordan23ww — Wed, 27 Oct 2021 13:45:32 GMT

@CreditInspired wrote:
@Jordan23ww wrote:
@unsungivy wrote:
@Jordan23ww wrote:
@VanderSnoot wrote:
Congratulations on lowering your APR!

I'm reading this as a single dip: Prime + 13.99 = 17.24%, the rate given during your phone call and on the mailer.
@VanderSnoot Thank you! So are you saying it's not 13.99%? I'm confused.
Correct. It's not 13.99%... it's 13.99% PLUS PRIME. When you add in prime, it's 17.24%
@unsungivy Oh wow! Thank you for clarifying! This is such a weird way to write this. It would've been better just to say your new rate is 17.24%! Who even talks like you this? "I'll be by to pick you up at 7:15 plus 15 minutes (7:30)!" 😂🤣😂 Oh well! Thank you again!
Good one!!! I have got to use it 🤣😂😆

@CreditInspired Thank you!😁 Feel free to use it!😂🤣😂