The title of this post = What Chase is attempting to accomplish with their recent decision (after pressure from NY Attorney General Cuomo) to refund their ill-advised $10/month finance charge.
Yesterday I received a letter from Chase announcing that they are rescinding the $10/month service fee/finance charge AND in a separate mailing, my new statement which showed a $30 credit for the monthly finance charges billed in January, February, and March. I thought it was interesting that the statement and “we’re guilty of dirty dealing, it’s affecting our reputation adversely (who knew??) and now we want to make it all better” letter arrived on the same day. Evidently Chase had to think about it a while before deciding I was one of the 184,000 customers to whom the finance charge would be refunded.
My payment remains at 5% of the outstanding balance OR (lucky me….) I still have the opportunity to agree to raise my interest rate to 7.99% until January, 2011 and revert to 2% of the outstanding balance payments. This is the fourth month of making payments at the 5% level and it is becoming more painful each month, even as the total payment goes down. By the 21st of this month, I will have paid Chase $3,835.00 for four monthly payments – instead of the approximately $1,588 my payments would have totaled in that same four months had Chase not unilaterally changed the deal we made over three years ago. That’s $2,247.00 in additional outgo carved out of the household and business budgets that was totally unanticipated.
We are determined not to give in to Chase’s manipulative, coercive actions but it is getting harder and harder to do so. I know the law moves slowly and will likely not provide any relief before our outstanding balance is paid in full, but hopefully the lawsuits will eventually prove effective. May the famous quote, “The wheels of justice grind slowly but exceedingly fine….” prove true and Chase gets it just “reward” for the undeserved punishment it has been unmercifully heaping upon its most reliable customers.
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on Apr 7th, 2009 at 9:48 am
Chase can forget about our “forgetting.” I just a read post by an obvious troll who praised Chase for a ‘wonderful, noble” decision to refund $10 and encouraged everyone just pay the whole balance in gratitude.
In response, I burst into singing:
Allons enfants de la Patrie
on Apr 7th, 2009 at 10:16 am
It is getting very painful indeed…especially since my pay has been cut for at least a year and a half. It is more tempting every day to give in to the 7.99, but I keep telling myself if I can hold out for another 7 months, I will be at my original payment. I hate to give Chase the satisfaction. I am also hoping the new credit card legislation will pass and give some relief. I could shift the balance to other cards for a year, but afraid they are going to jack the rate up after the transfer.
on Apr 7th, 2009 at 3:28 pm
I’m in the same boat. I’m counting down the months till my payments get back to a reasonable amount, and just hoping that I can keep my head above water till then. I really don’t want to give in to Chase’s strong-arm tactics to change to the 7.99 variable rate. I’d love to see the numbers on how many customers were forced to accept the higher interest rate.
on Apr 7th, 2009 at 6:22 pm
I am really curious about why some cardholders were reverted back to the 2% min payment without taking the 7.99% rate. Does anybody have a comment on this one?
on Apr 7th, 2009 at 6:38 pm
Marge11 I’d like to know too, I also got my letter stating my 5% would remain in force.
on Apr 7th, 2009 at 6:55 pm
Marge11, I don’t know, but my “optional alternatives” include:
a. 7.99% rate
b. “a minimum payment calculation that consists of the greater of $10, 2% of your New Balance or 1% of your New Balance plus billed interest and any billed late fees. After January 1, 2011, the APR for any remaining portion of the of the balance(s) would be the applicable APR associated with this type of balance as outlined in your Cardmember Agreement and any subsequent disclosures. As always, your account remains subject to all terms and conditions, including default APR actions, as outlined in your Cardmember Agreement.”
There is an option of temporary reversion to 2% (until 2011). Quite a departure from the AGREEMENT. Dr. Lahm and other people (Lyn for example) wrote so well on the topic that I don’t want to give a new pale, much less competent version of comments.
I do know that they breached the contract/violated the law; did it while taking our tax money and that they should go to prison (at least).
on Apr 7th, 2009 at 7:25 pm
Anna22,
Those are not very comforting!! I am assuming everyones default rate will continue to go up until Jan of 2011 and then the balance will be at that rate. I wonder if those who received the we sent you a “change in terms notice in error” are being changed again?
on Apr 8th, 2009 at 12:38 am
Marge11,
“Those are not very comforting.” Yes, this was my point.
Chase must be stopped.
on Apr 8th, 2009 at 3:43 pm
When a person “takes possession” of money from Chase (e.g. a convenience check)… Chase immediately begins charging interest… compounded daily.
Since January 1… Chase captured $30 from 184,000 of their best customers. That’s more than $5.5 million.
Would you like to use $5.5 million for 3 months INTEREST FREE?
Do you think you are entitled to be paid interest on the money that Chase… without your permission… “took possession of”… and was not available for your own use?
At what APR should Chase pay us interest? Not only didn’t we agree to loan our money to Chase… we had no means to stop them from “taking it”.
You may think it would be fair to charge Chase interest equal to the Purchase APR they charge you.
But this is different… let’s call it what it is (and they have admitted to) — They tried to steal this money from us.
Consequently… we should be entitled to receive interest calculated at the maximum APR allowed by law – the law that the credit card industry bribed congress to pass. That’s 30%… compounded daily.
I could be wrong but I calculated the interest due each of us to be $1.52 – a trivial amount but each of us “earned” it.
I want payment – not a credit. I want a cash payment. I want to receive a check in the mail. I want to maximize their pain. Since I will report this income on my 2009 Income Tax return… I want Chase to send a 1099 to me in a timely fashion.
Making this demand on the phone would be an incredible waste of time. But… if you’re familiar with the OCC complaint form… you can spell out the resolution you seek.
This is about getting this into the mainstream media – destroying Chase. 10,000 complaints – identical complaints filed with the OCC – each demanding interest of $1.52 being paid with a check… in the mail. And a 1099 mailed in January 2010.
Priceless.
If we let Chase slide with multiplying the minimum payment (to which both parties agreed to be 2%) by a factor of 2.5 — (to be 5%)…what’s to stop them from another increase? From their point of view… this copuld just be a test to see what they can get away with.
There is a good chance that the $10/month charge was an “add-on” to what they really wanted to do – a distraction if you will. So far it’s worked. But… in the big picture… $10/month is trivial when compared to how this (much) higher minimum payment will affect your life.
With Universal Default scheduled to end in a year… Chase’s real mission could well be forcing as many people as possible into default.
Like the Doc and other posters in this thread… I’ve been able to handle the increased minimum payment for the past 3 months… but it’s getting increasingly difficult… and there is a good chance that I will be forced into default.
Don’t be naive about this. As evil as it may sound… it would not be outside their normal behavior to do something as evil as purposely forcing people into default.
This entire meltdown was (in fact) planned by the financial industry. Watch the William K. Black video from the 4/3/09 Bill Moyers’ Journal at http://www.pbs.org/moyers/journal/04032009/watch.html
These greedy bastards have destroyed the middle class… with intent. And they’re not done yet.
on Apr 8th, 2009 at 3:53 pm
The best time to try to beat up a bully is when they stumble. Little people have no choice other than to “kick them while they’re down.”
Thanks to Chase pissing off the Doc… we’ve got some momentum going on now. To let them off by allowing them to simply credit your account with the exact amount they have now admitted to stealing from you… is an incredible waste of an opportunity to stop these guys from further abusing their power.
on Apr 9th, 2009 at 7:35 am
Vito, good comments. You are dead on.
I have a mortgage with Chase. Normally, I would do my best not to default on anything. However, if the market does not increase over the next few years, now I would have no hesitation with walking away from my house and letting Chase take the hit.
As well, you are right. Their telling people the 2% payment till 2011 means nothing. They could turn around tomorrow and do the same thing..that is, raise it up to 5%. Think about it, with billions from the government, Chase doesnt need the credit card business. It wants to lose customers, and that is their ultimate goal. Force defaults so it can get more Federal dollars, and eventually get out of the credit card business. As long as they get Federal funds, nothing is going to change their plan.
on Apr 9th, 2009 at 12:53 pm
I doubt that Chase is trying to get out of the credit card business. It has been a “cash cow” for them and they are just trying to make the cow give more milk….faster. I believe the credit card companies have adopted a “scorched earth” policy to suck as much capital out of the customers that still have the means and will to protect their credit scores between now and when they will have to abide by new rules in July 2010.
Why congress would give the credit card companies 18 months to stop abusing consumers but allow those same companies to change terms with 15 to 30 days notice is beyond my ability to understand. (Well, actually I do understand it….the CC companies lubricate congress with lots of campaign contributions and pepper the halls of congress with highly paid lobbyists.)
Chase has chosen the wrong group of people to mistreat. We have to keep the pressure on Chase (and congress) and let them know that we are not going to stand by silently and accept their egregious actions.
on Apr 10th, 2009 at 7:05 am
Chase is STILL, to this day, branding us as problem customers even though we all were paying according to THEIR terms. Here’s an MSNBC article written on April 8th:
http://www.msnbc.msn.com/id/30111663//
Taken from the article:
Chase will not comment on a pending lawsuit, but the company e-mailed me a statement. “Tens of millions of Chase customers have taken advantage of our promotional low rate financing over the last five years,” writes Stephanie Jackson, first vice president for public affairs.
“Most of these loans have been paid back in less than 24 months. However, there have been a small percentage of customers that have made little progress in paying down these loans. Our desire is to have these loans repaid in a reasonable period of time.”
on Apr 10th, 2009 at 5:34 pm
Greg,
Hard to believe. We must fight this evil. Such texts are … how to put … inspirational, reminding me that I can knit and sing “Allons enfants ..” All I need is a seat in the first row.
on Apr 11th, 2009 at 4:12 pm
What about the Chase customers who regularly paid, never defaulted, but have now been forced into default because of this action by Chase? Some of us have not been able to weather the tripled monthly minimum payments (5% from 2% payments of balance). Credit good, diligently paying off all debt, then this hits us. We are now getting letters from Chase that state how much Chase values us as loyal customers and values long-term relationships. The letter states that Chase understands how the current financial conditions might make it difficult for us to pay (as in Chase has unilaterally pushed us over the edge!). They want us to call and they’ll help us pay off the debt in monthly payments over 60 months. That was not the original terms of the contract. Early on we tried calling them for weeks, and received the runaround. Now they are begging us to call them. Enough is enough! Our credit score is now ruined. Thank you Chase.
on Apr 13th, 2009 at 2:44 pm
I was one of the Chase customers who elected to accept a 7.99 percent interest rate in order to avoid the new monthly service charge and bigger monthly payments. Although they are refunding the $10 service charge to the folks that didn’t choose the 7.99% option, they are not offering me the option change back to the 3.99% with a 5% monthly payment from my current 7.99% with a 2% minimum payment. My balance is only a few thousand so it really doesn’t make much difference–it’s simply the principle.