Rate Jacking Sucesses/failures

gandg21

hi,
i have been using my credit cards for 3+ years. but now MBNA have increased my interest reate to 34.9%, egg to 34.9% and now marbles to 39.9%.
I have never missed any payments. I have been paying more than the minimum at times.
I applied for a loan 6 months ago to cover my credit card balance and was turned down, so i checked my credit report, and it is POOR.
I cannot work out why it is poor, but recently i applied for car finance, and was rejected as well. Again due to my credit report.
I cannot pay these extortionate rates forever, and i cannot get a loan to cover the balances, and now i will not be able to get a 0% credit card deal due to all of the above.
I am totally up sh*t creek without a paddle now. I would be happy if the rates were what they advertise as typical 16.9%, but now this is taking the proverbial!
Any advice?
thanks

soulflavas

First time using this forum, hope it proves useful? By my own admission I do not always read letters fully. Just found out today that I missed the Oct 3rd cut off to repay my Egg card avoiding the rate jack. Advice please, is best to write to them and explain? I have always paid by monthly direct debit.

M_Thomson

zoony67 wrote: »

I also have a virgin card and found out a few days ago that they were charging me an incredible 34.9% APR !!!!!!! Sick , I rang them and the best I could get it reduced to was 29.9% hardly groundbreaking but the best I could do.

No wonder Branson is a millionaire ! with interest rates at their lowest these compaines are extorting money at ridiculous rates how do they get away with it ?

MBNA runs the cards though not Richard Branson. He just licenses the name to them.

TFD_2

petera74 wrote: »

The minimum payment mainly is made up of interest due to the Credit card.So no debt on the card ever gets paid!
For me. I have 3500 pounds of debt on a Virgin MBNA card. In Jan 2008 they changed my interest rate from 15.9% to 29.9%.
So I work out I can only pay about 100 pounds each month. Of which at 29.9% APR. 86 pounds is interest and 14 pounds is off the debt. So in a year of paying 100 a month, 1200 for the year. 1032 pounds is interest and 168 pounds is off the debt.
So in a year at 29.9% APR I would get the debt down to 3332 pounds.
If they left me at 15.9% which I signed up for and spent at that rate.
At paying 100 pounds a month for a year 1200 for the year. I would have paid 528 pounds in interest and 672 pounds of the debt.
So in a year I would at 15.9% APR I would get the debt down to 2828 pounds.
To me at a rate of 15.9% APR I have a chance at clearing the debt.
At 29.9% it is a lot harder to do.

The key is to pay more than the minimum payment, even if only a little. Throw an extra 20 quid a month at it, and you'll have paid off over £400 rather than £168.

henry01

Capital One
Since 2005
Doubled the APR

Phoned and moaned, was told nothing they can do - told them there is and quoted "The December 2008, UK Payments Administration statement of principles on repricing" he put me on hold. After hold said I can cancel and pay off on old APR

BRILLIANT!!

Thanks Martin!!

Auburnginger

I got a letter through a few months ago from Capital one notifying me that my rate would increase from the 14.9% ish that it was to about 24% due to to the current climate.
I'd taken the card out as a 0% balance transfer, and took just over the 12 months to pay it all back, and then used it for a few more purchases, and usually paid off the balance. I wouldn't have considered myself to be a high risk. I just wrote to them and closed my account expressing that due to the current climate, the interest rate was no longer competitive, they did not try and change my mind, but I did not challange it, I didn't know you could. Anyway done now. I think they did say that any current balance would remain at the original rate till paid off, which is somthing I suppose!

Embroidery_Bloke

Hi - I to had a Capital One card with a very low limit of £300 and 30% rate - recieved a letter saying is was going up to 39% when i phoned to complain they were not at all interested, said that i could carry on at the new rate or cut up the card!! Used Credit Experts website to see which new card i would be accepted for, Halifax seemed the best so applied and was accepted! rate 15.9% (0% for 9months) and not that i will use it, but a limit of £3k - So yes Capital One i have cut up my card, and would recomend everyone else who can to do so! PS - first ever post!!

zhatorna65

• Who Rate Jacked you: MINT (operated by RBS)
• Did you manage to get the rate reduced: NO

I've just been on the phone with MINT, who operate my visa card.

They recently said on my Nov statement that the rates would be going up to 1.941% (I make this 23.32% PA). Currently I have 1.736% on purchases and a 0% for balance transfers that's due to go back up to 1.59-ish in January.

I asked for an explanation and got some waffle from the phone operator about not really knowing why, and he was surprised when I told him that he had to give me a reason.

Eventually spoke to his supervisor who said this is a "general rate increase across this product" and has nothing specific to do with my own account or my credit rating.

Needless to say, she wasn't budging on whether they would consider waiving the increase.

So I've closed and will be getting a letter confirming this in 3-5 days she says. I confirmed that as long as I make the minimum payment, the account continues as before except no more borrowing on the card is allowed.

I've had this account 12 years, and been offered fee-free balance transfers twice during 2009; I've never missed a payment, and repayments this year have been way over the minimum. None of this seems to count for anything.

Anyway, their loss - once January arrives I'll look at transferring as much of this balance as possible to one of my other cards, which have way more reasonable rates anyway (MBNA 1.2408%, Smile 1.313%).

jackb24

We obtained a virgin credit card on a 0% rate for 15 months promised a 16.9% rate after this. Received a letter stating it would go to 39%.
Wrote a letter in disgust so they dropped it to 34%. Thinking very unfair also very greedy are they allowed to do this so we wrote to the financial ombudsman, waste of time, it seems they are allowed to do whatever they like. We used some of our savings and paid them off and told them what they could do with their card,no more credit cards for us.:mad:

petera74

Good news for me!
After a long battle with MBNA after they increased my rate from 0% to 15.9% then 34.9% 2 years ago. After a so called !!!! up at MBNA with taking my new bank details. Basically I rang up with my new bank details and the advisor never took the details.They then had an excuse to take my promotional rate away, because no payment was took.
So because of there errors I was forced into a nightmare situation with the interest.

So I built up quite a telephone log with MBNA, to make sure I had a good paper trail. I.e. I would ask for a statement to be delivered, then when they didn’t send it. I had the proof with all the advisors details and time logs. Also changed my payment date, which was my best performer. MAKE SURE YOU GET THE ADVISORS DETAILS AND EXCACT TIME/DATE LOGS. Aim afraid you have to play dirty with MBNA. I produced evidence in my complaint that certain advisors were not doing what they should be. To substantiate my claim, that an advisor didn’t take my details when I called.

Some notes make sure you read through martin’s exceptional article about this.

http://www.moneysavingexpert.com/reclaim/credit-card-interest-rate-increases

Write to MBNA in letter format to justify the credit card increase, ask as many questions you can in regards to the fairness of it all. Include all evidence and correspondence. Ask for a Final response letter straight away. This will save you time.

Once you have the final response letter.
Call the FOS to log a complaint and contact your Local MP. My MP was very help full. Also the FOS very helpful and professional. Can’t thank them enough.

They have refunded my account with 2 years interest and 150 quid compensation.
Total 1000 pounds.

It takes time, but it's worth the time to get treated fairly. I just wanted justice and with the help of the FOS and my local MP. I finally got to a result I was happy with.

Note - MBNA/Virgin said to me I would be wasting my time pursuing via FOS.
Do not listen to them.

Good luck.

Peter