I just discovered a Capital One credit card scam

[ensho]

will try to make this short.

have only one credit card.

several yrs. ago they upped my interest which was 12+%. I called, asked why - they put it back down to 12+%

this month's bill has the interest up to 13+% so I again called.

they said they would lower it again but first they would send me a check for $500 that I can put into my bank acct. and use. $500 from my credit card.

I said I didn't want to borrow $500. they said it wasn't a borrow it was from the credit on my card. I said I still have to pay the $500 back so its a borrow I don't want.

I said it was a scam. they said oh no.

I said goodbye.

[smiley_glad_hands]

1. You do know any CC company can change your rate whenever they want right? eom

[closeupready]

4. Without cause, that should be illegal.

IMO.

[TechBear_Seattle]

5. Should be, but is not

Read the "Terms and Conditions." By accepting the card, you acknowledge that the credit card issuer can change the terms of your credit at whim, and you cannot do squat.

[closeupready]

12. Right.

All I'm saying is the obvious, which is that if there were a law specifically outlawing this, it wouldn't matter what the contract said, or what you agreed to - such unilateral changes would be unenforceable.

[RB TexLa]

6. Why should it be illegal? It's in the contract accepted by the cardholder.

[Occulus]

10. Quick! Name another contract that can be altered by one party to that contract

at any time that party desires, but not by the other party.

(Contracts between unions and employers do not count.)

A contract is a contract is a contract. CC companies should not be allowed to alter rates on charges already applied to the card. You want cardholders to be held to the terms of the contract they agreed to? Fine. But you also better want the the same deal for the issuer, too.

I personally wish they were held to the terms of the agreement as it is initially agreed to, period. No "new terms", ever. They should not have the right to alter the initial agreement for any reason without having to go through a form of binding arbitration by a neutral third party.

[RB TexLa]

11. Any contract where it is stated that changes can be made by a party

They are not altering anything in the contract, all credit card contracts state the current rate is subject to change. How do you consider a change in the rate a "altering" of the contract? We are talking about an open ended principle adjusted loan. The cardholder can greatly increase or decrease the principle amount or the length of the loan at any time as well you know.

[Occulus]

25. But I said, "name ANOTHER contract"

As in, not a credit card.

As far as I've ever seen, credit card contracts are the only contracts that allow a one sided, non-negotiable change AFTER the contract is signed.

That needs to be outlawed.

[closeupready]

13. Because higher interest rates harm consumers.

n/t

[RB TexLa]

15. And not being able to adjust rates in response to market conditions, competition or consumer

actions harm creditors ability to issue credit, harming both consumers and creditors.

There are many options to move credit card debt to fixed rate loans if one has a fear of credit card rates going up.

[closeupready]

16. No. Consumers should come first.

If creditors don't want to respect the terms of the contracts as agreed, get out of credit cards.

I'd survive just fine. We all would.

[RB TexLa]

18. The terms are that the rates can be changed? How is doing something that is allowed in the contract

not respecting the terms of the contract?

[closeupready]

19. The law reigns supreme over contract terms.

So the contract could say "one day late on a payment, and we own your house, car and firstborn", but that would be unenforceable. So it would be if the law said no unilateral changes in interest, regardless of what terms to which the consumer agreed.

[RB TexLa]

20. But the law doesn't say that, because of the nature of credit cards

[closeupready]

22. That should be the law.

n/t

[RB TexLa]

23. If you want to have no credit cards issued, yes that would be the law you want.

[Orsino]

26. Usury.

Which should also be against the law. No one should be able to go into debt at injurious interest rates.

[surrealAmerican]

8. ... and without warning.

The laws are written to protect them, not you.

[ensho]

7. that's not the issue. yes I know they can change it at any time

the issue is the scam. I must put $500 on my credit card before they would lower the interest.

[amdezurik]

2. huh, take the check

then as soon as it clears cancel the card. Gosh then it will magically turn out ot be a loan after all...

[mainegreen]

3. Ah yes, the credit card 'cash advance'. Higher interest rates.

Often double.

My credit card company always sends those stupid 'cash advance' checks. I always shred them, but I can't get them to stop sending them.

[ensho]

9. those checks come with every monthly bill

I shred them too.

[northsongs]

14. These banks are creative at cheating you!

Watch out particularly for those cash advance checks and balance transfer offers. Used to work for one of the biggies and they know how to hook you. Usually, they'll raise your rate, then offer to put it back to what it was before, only to find out that applies only to a new balance, either through a check they send you (as in this case), or enticing you to transfer a balance. These lower interest charges are usually what gets you. When you make a payment on the account, it wll be applied to the balance that carries the lowest interest rate first, for example you have a regular balance of $1000 at 12% and a balance transfer balance of $2000 at 5%. The payment will apply to the lower interest bearing account (the balance transfer at 5%0) until it's paid in full. In the meantime the regular balance of $1000 at 12% will sit there and grow with the 12% interest charge each month. These people are sharks, STAY OUT OF THE WATER!

[LiberalHeart]

17. I don't know my card's interest rate because I always pay in full, but...

...I was surprised to see that they've boosted my credit cap by several thousand dollars this month. Why would they do that without any request from me? I don't need the extra credit, don't want the extra credit, and have never run up bills anywhere close to where they've set it. Not by a long shot. What's behind that kind of action on their part -- particularly at a time when people are defaulting in record numbers?

[Gormy Cuss]

24. They're hoping that you'll charge more.

Customers with a good payment history and good credit scores are seen as a better risk, and their analysis is that you would remain so even with the new higher credit limit. Every time you charge they get a percentage-based fee ostensibly to cover transaction costs but on large ticket items I suspect that there's a good profit potential included in that fee. With a bigger limit there's a better chance that you'll buy furniture or pay bills using the card rather than paying by cash or check -- at least that's the thinking.

[Marie26]

21. Capital One IS a credit card scam

They basically prey on people w/low credit scores - quite a few Attorney Generals have already filed suit against them.

[Mike 03]

27. It's even worse than you think

Did you know that if you have two credit cards, card A and card B, if you are late with a payment on card B, cardholder A can raise your interest rates?

It's true.

[Chemical Bill]

28. Tell Capital One to take a hike.

Cancel that card and sign up for one from a local credit union or small bank. We have to hit Wall St where it hurts, people.

Bill