topic Re: Lookout for BOFA Annual Fees in Credit in the News

Lookout for BOFA Annual Fees

Anonymous — Tue, 27 Oct 2009 23:25:24 GMT

Bank of America may have said that it will not raise credit card interest rates prior to the implementation of the new laws, but that earlier announcement did not categorically state that it will not charge new credit card fees. And so, in a move seemingly designed to recoup anticipated revenue loss, Bank of America revealed Tuesday that plans are underway to impose annual fees on a number of cardholders next year.

According to Bof A spokesperson Betty Reiss, the annual fees would range from $29 to $99, and the proposed fee would initially affect about 1% of the bank’s credit card customers. “We’re testing this to see what the feedback is. In terms of any plans going forward, we haven’t made any decisions yet,” said Reiss.

With about 80.2 million credit cards issued and in circulation, Bank of America is one of the largest credit card companies in the country today, third only to Chase with 119.4 million cards, and Citibank with 92 million cards. Customer accounts that could be affected by such fees are being selected based on “risk and profitability,” meaning, cardholders who are in good standing, never pay late, and almost never get charged with interest fees, could find themselves among the first ones to get slapped with the fees.

Customer complaints of steep interest rate hikes and sudden cuts in credit limits came to a head earlier this year, prompting the Congress to take steps in curbing banks’ practices which were detrimental to consumers’ finances, to say the least. The new credit card consumer protection laws include provisions on how and when a bank or credit card company can raise credit card interest rates and fees.

Bank of America explains its decision to charge this additional fee to affected cardholders by stating in its notice that the bank is making such moves “in response to market changes, new federal laws and regulations, and the increasing costs of providing unsecured credit.” Customers who will be affected by these changes in credit account terms and required to pay the annual fee have the option to reject it, but will have to contend with the consequence of having their account closed.
About the banks

Re: Lookout for BOFA Annual Fees

haulingthescoreup — Wed, 28 Oct 2009 00:07:23 GMT

Thanks for posting, but this looks like a quote. If so, forums guidelines ask that you both post the source (ideally, a link), and not quote the entire body of the quote --only excerpts.

Here are the guidelines:

Citing articles (please read before posting)

This link is stickied on the Credit in the News board.

Re: Lookout for BOFA Annual Fees

llecs — Wed, 28 Oct 2009 13:07:23 GMT

I think it came from here:

http://www.mybanktracker.com/bank-news/2009/10/14/bofa-reveals-plans-to-impose-credit-card-annual-fees-next-year/

Re: Lookout for BOFA Annual Fees

Anonymous — Wed, 28 Oct 2009 13:24:44 GMT

Yeah, plasticguy...'Credit in the News' is where it should go. Makes it easier for me to find so I can b*tch about it!

Re: Lookout for BOFA Annual Fees

haulingthescoreup — Thu, 29 Oct 2009 12:44:41 GMT

Movin' on over!

Re: Lookout for BOFA Annual Fees

Anonymous — Mon, 02 Nov 2009 15:09:35 GMT

I am one of the .5%-1% BofA decided to add the annual fee to. I only had one credit card with a $1000 CL that I PIF every month, and they were going to start charging the $29 annual fee.The account was only 2 years old.

I used to have my checking and savings accounts with them that were fee-free, but closed them in March when they decided I had to keep $750 in the checking account or pay a monthly fee. I had just gotten a mortgage with Wells Fargo, so guess who got my business for checking/savings.I recently applied and received a CC from WF with a $6000 credit limit, so the timing was perfect for closing BofA.

It was surprisingly easy to close the BofA account, in fact a little scary easy. I called the number provided from my home phone (I'm guessing they have it on record), and after a short message basically saying 3 times that I will be closing my account if I reject the fee, I entered the last 4 digits of my CC number. The 'voice' reiterated again that the account will be closed because of the fee rejection and that was it! Done.

I know I'll take a hit on my credit score for closing one card and opening another, but since I already have a mortgage, and won't be buying any big ticket items (like a car) anytime soon, I'll take the temporary hit. My scores went up 20 points when the new WF card reported. It'll be interesting to see how much they come down when BofA reports.

Re: Lookout for BOFA Annual Fees

Jazzzy — Sun, 08 Nov 2009 21:53:09 GMT

@Anonymous wrote:
I am one of the .5%-1% BofA decided to add the annual fee to. I only had one credit card with a $1000 CL that I PIF every month, and they were going to start charging the $29 annual fee.The account was only 2 years old.

I used to have my checking and savings accounts with them that were fee-free, but closed them in March when they decided I had to keep $750 in the checking account or pay a monthly fee. I had just gotten a mortgage with Wells Fargo, so guess who got my business for checking/savings.I recently applied and received a CC from WF with a $6000 credit limit, so the timing was perfect for closing BofA.

It was surprisingly easy to close the BofA account, in fact a little scary easy. I called the number provided from my home phone (I'm guessing they have it on record), and after a short message basically saying 3 times that I will be closing my account if I reject the fee, I entered the last 4 digits of my CC number. The 'voice' reiterated again that the account will be closed because of the fee rejection and that was it! Done.

I know I'll take a hit on my credit score for closing one card and opening another, but since I already have a mortgage, and won't be buying any big ticket items (like a car) anytime soon, I'll take the temporary hit. My scores went up 20 points when the new WF card reported. It'll be interesting to see how much they come down when BofA reports.

I don't think your FICO will take a hit for closing BofA. You now have a higher credit limit, so if you continue to use your card wisely and PIF each month, you shouldn't be affected. Your BofA account can continue to report for up to 10 years, so you will still reap the benefit from it for quite a few years to come.

Congratulations on your decision. We will close cards at our house that begin to charge an annual fee. We only pay one...and that's on an airline card that we feel we get a lot of value from.

Re: Lookout for BOFA Annual Fees

Anonymous — Sun, 15 Nov 2009 18:16:42 GMT

So my credit score did take a small hit but the scores are back to what they were prior to doing anything with the credit cards.

Initial scores: EQ 749, EX 753, TU 749

With new WF CC: EQ 763, EX 767, TU 763

After closing BofA : EA 749, EX 767, TU 749(EX not showing BofA closed yet).

Re: Lookout for BOFA Annual Fees

haulingthescoreup — Sun, 15 Nov 2009 18:22:09 GMT

I'm glad that your scores seem to have recovered!

A question, though, where did you get your scores? Consumers haven't been able to buy their Experian FICO score since last February. However, there are all sorts of outfits ready and willing to sell you mostly-worthless FAKO scores, including Experian itself, TransUnion/ TrueCredit, freecreditreport-dot-com, CreditKarma, CreditSecure, and on and on.

Re: Lookout for BOFA Annual Fees

Anonymous — Sun, 15 Nov 2009 20:14:55 GMT

After reading some other threads, I signed up for CreditCheckTotal. I understand they are FAKO, but just wanted to get an idea what range my scores are in.

When I got my mortgage in February, I got the 3 FICO scores from here - EQ 789, EX 791, TU 745 (they were late dropping a disputed record). At this point I really don't have a reason for watching my score, so I'll probably drop CCT soon. No sense wasting money!

Re: Lookout for BOFA Annual Fees

Anonymous — Mon, 16 Nov 2009 14:51:10 GMT

CCT uses plus scores. The reason your scores on CCT showed the pattern of gaining points with WF and then losing them with the BofA closure, is that the plus FAKO looks positively at having TWO bank/national accounts. FICO only needs one - and I'm sure your FICO will not drop with the BofA closure - esp. if you were PIFing and it doesn't affect your utilization.

I would suggest opening a 30-day free trial of Score Watch and seeing how your Equifax FICO is affected when the BofA closure hits - that's the real stuff. All the FAKO scores and recommendations on CCT are imaginary.

There just is no correlation between CCT's Plus FAKO's and FICO scoring. (I pull daily - but I ignore their scores and their recommendations)

For example:

CCT gave DH 10 points with our new mortgage, EQ FICO - no score change.

CCT took 9 points when DH used Macy's Visa for first time, EQ FICO - no score change.

CCT took 9 points when DH added auto loan, EQ FICO - only lost 2 points.

CCT gave 9 points for unknown reason, EQ FICO - no score change.

CCT gave me 20 points for adding mortgage, EQ FICO - no score change

CCT took 14 points when I removed an AU account, EQ FICO - no score change (this was another case of FAKO favoring TWO bank/national accounts)

CCT gave me 14 points when I added my Juni account, EQ FICO - no score change (" as above)

Congrats on your lovely new account and on closing BofA with their new AF!

Message Edited by beamMEup on 11-16-2009 07:51 AM