MBNA increase in monthly repayment...

mobeyone_2

MBNA have sent me my latest monthly statement, they have increased my minimum repayment from around £75-£108!

Can anyone offer any advice on what I can do? this is the third time they have done this and comes after the last 6 months, my monthly repayments have barely been covering the interest.

No late payments and all prompt, disgusted with this now.

stephane_2

MBNA would normally take the same % of outstanding balance (either 1%,2% or 3%) depends on your T&C, so for minimum payments to increase would be that your outstanding balance has increase over the last few months or your interest rate have gone up. Have you call them and asked? you'll have the answer

mobeyone_2

Balance has remained the same so I guess the rate has gone up, unable to call until tomorrow as I only got the email earlier this evening.

Is there nothing that can be done? surely they cannot be allowed to push up the rates in this way?

YorkshireBoy

mobeyone wrote: »

...I guess the rate has gone up...

You guess? They'll have written to you if they've raised it. It'll also be on your statement and online (if you have access?).

unable to call until tomorrow as I only got the email earlier this evening.

Aren't they 24/7? They used to be.

Is there nothing that can be done? surely they cannot be allowed to push up the rates in this way?

See here...

http://www.mbna.co.uk/principles_sp/principles_vm.html

jonesMUFCforever

Yers they can!
They are not increasing your rate of interest just the minimum payment per month.
Honestly if you cannot afford 1% per month more then you are in serious debt trouble and I can only advise you to go to the debt free wanabe board.

mobeyone_2

Its not an issue of if I cannot afford an increase but more of a case its a case of why or should they considering the times that we are in.

I always used to pay over but since the last increase in rate I began to pay the minimum.

MBNA have practically doubled by monhtly payment in a space of 12 months, how can that be justifiied?

chattychappy

Can we be clear for a moment?

Have they increased the INTEREST RATE???? They can do that, but you can always refuse, stop using the card and pay off at the old rate.

I've not had a balance on MBNA for a while. But I'm pretty sure one of their min payment calculations was related to interest due. Ie the greater of 1% of balance and the interest+£25 or some such. If the formula is like this, then the min is going up to ensure it always at least covers the interest....

YorkshireBoy

mobeyone wrote: »

...considering the times that we are in.

I always used to pay over but since the last increase in rate I began to pay the minimum.

There's your answer. You are an increased risk to them, and they perceive their capital to be at risk so they're trying to increase the revenue instead.

MBNA have practically doubled by monhtly payment in a space of 12 months, how can that be justifiied?

If you read the article I linked to above you'll see (see note 5 in particular where, if asked, they'll justify it for you).

At the end of the day though, and certainly since January this year, you had/have the option to stop using the card and keep the old interest rate. Why haven't/didn't you?

mrsJeckyl

We had a letter from MBNA recently saying that they were putting their interest rates up this month unless you rang them to pay off your balance at the rate you were already on. I think they were putting it up to something stupid like 30%. We rang them and now our 0% has ended this card is our main priority to pay off.

willstewart

YorkshireBoy wrote: »

At the end of the day though, and certainly since January this year, you had/have the option to stop using the card and keep the old interest rate. Why haven't/didn't you?

I look at it this way.
Say you've got a card with a £2000 limit of which you may have half outstanding. They then decide to put your interest rate up from 16.9% to 34.9%.

Your options here are:
To let them know you want to pay the card off at the original rate and then it will be closed.
Accept the rate and carry on paying / spending as normal etc.

It's sometimes all well accepting the lower rate but at the end of the day there's no guarantee that once this card is closed that you will get another if need be.
I would personally rather have a card available to me for emergency purposes rather than have no access to any credit if and when needed.
It may have a higher interest rate than you would like, but you've still got access to it and as long as you don't starting spending willy-nilly on it, hopefully things will be fine.
Also helps keep your credit rating good if you spend the odd small amount and pay it off quickly.

mobeyone_2

YorkshireBoy wrote: »

At the end of the day though, and certainly since January this year, you had/have the option to stop using the card and keep the old interest rate. Why haven't/didn't you?

That is where I am at fault. At the last increase, I thought I would be able to clear but with everything else going up, made the cutbacks that were needed and I agree, it is best to have a card available to you if needed.

That said, I will be on the phone to them today asking to stop the card and to agree a plan to repay the balance, are they open to offers on clearing balances or is it a worthless exercise?