Virgin credit card DOUBLING their APR

wontfallforit

I have a credit card with Virgin (provided by MBNA bank, it seems).

I got it about 2 years ago to transfer a massive balance on to, for 12 months interest free.

I transferred around £4000 onto it, and managed to clear almost 2k in the 12-month period, so it served me well.

After this period, the APR went to 14%. Fine, I can deal with that, it's much lower than the godawful credit card I initially got rid of and transferred to Virgin in the first place.

Anyway, I've been happily chipping away at my balance for about a year, and it's now gotten down to £1,000. I've just got a new job which would enable me to pay the full balance off my March, based on £250/pm monthly payments. Can't wait to get rid of it, it's the last scrap of debt I have, after running up around £10,000 in a space of just 2 years (and I'm still under 25...thankfully I saw the light early).

BUT, BUT, BUT...

I received a letter from Virgin a couple of weeks ago saying that my interest rate is about to "change". I expected a jump of under 5%. Nope, it's DOUBLED.

As of November, the APR on this card is going to jump up to 27%. What?!? I thought those days were long behind me!

Has anyone ever heard of this happening? Though I've had far too many credit cards than is healthy in the past, I've never (until now) bothered looking into the APR. My bad credit meant they all ran at over 30%, and I was fine with that (again, it was long ago, thankfully).

Just in case anyone's wondering, I haven't done anything that would put me in Virgin's bad books. I've never missed a payment, I regularly overpay (though not by a great deal...yet), and in fact I've not even used the card for purchases in over 2 years. I've just been paying the old balance off.

Is this just one of those things? Or is it in fact because I haven't spent on the card in ages?

I could of course phone Virgin and find out, but I only have a mobile phone, and I'm loathe to make 0845 calls on my mobile. Plus I can never remember the bloody security questions I set up.

Thanks for any advice.

(PS, another point, I'm still active credit-history wise. I have a pesky overdraft that I regularly dip into until payday, plus my brother is repaying a large balance on one of my other cards for a purchase he made, so I haven't disappeared from the credit radar).

(PPS, in regards to my comment about my brother paying off my other credit card, that debt is within my affordability limits - though I'm not paying it myself - so I don't think that'd be a reason why Virgin changed their mind on me...I was in a much worse general financial state when I first got the 0% & 14% APR to begin with).

bambinaUK

I have a Virgin card too that comes to the end of the 0% this month, but Virgin have now sent me 2 letters saying that if I spend at least £10 before DEcember they will extend my interest free period to March 2010! I would get on the phone and give them some grief.

NickX

Pretty standard practice for MBNA

Time to Balance Transfer to a new 0% card methinks

wontfallforit

bambinaUK wrote: »

I have a Virgin card too that comes to the end of the 0% this month, but Virgin have now sent me 2 letters saying that if I spend at least £10 before DEcember they will extend my interest free period to March 2010! I would get on the phone and give them some grief.

That's why I suspect the reason for the APR jump is because I haven't used it in ages.

I got a similar letter from Barclaycard a few years back.

Thanks

wontfallforit

NickX wrote: »

Pretty standard practice for MBNA

Time to Balance Transfer to a new 0% card methinks

Will definitely be looking for a BT!

Shame I only had 6 months left to pay on it, based on my new repayment plan.

It's my first dealing with MBNA, and I think it'll remain my only dealing!

socks_uk

If it is the same letter I got it gives you the option to ring them and tell them you don't want the APR increasing and they tell you that you can no longer use the card. I rang them and my APR stayed the same but my account is now 'suspended'.

wontfallforit

socks_uk wrote: »

If it is the same letter I got it gives you the option to ring them and tell them you don't want the APR increasing and they tell you that you can no longer use the card. I rang them and my APR stayed the same but my account is now 'suspended'.

Someone at work received a similar letter, but I have mine in front of me, and no mention of re-negotiating the APR. Had you been using your card before you got this?

What's the number you can call? Is it the usual customer services number? And is there a deadline?

Thanks

Davey2009

I used to have a Virgin card & the phrase rip off comes to mind I got a transfer to Sainsburys Bank & have been a happy customer especially as I paid it of & just use the card for convieniance & now pay it all every month - anyway I would recommend them.

YorkshireBoy

wontfallforit wrote: »

Nope, it's DOUBLED.

So exercise your right to opt-out and stay on the old rate. Problem solved?

I haven't done anything that would put me in Virgin's bad books.

MBNA take regular monthly feeds from the CRAs (the fact they've taken these doesn't show on your credit report), and will see your other commitments...including the "large" purchase made for your brother. They may think the risk of lending to you has increased, bearing in mind you're rattling up debt elsewhere. That's maybe why they've rasied your rate, well...that and the credit crunch/state of the economy.

I could of course phone Virgin and find out, but I only have a mobile phone, and I'm loathe to make 0845 calls on my mobile.

So get on www.saynoto0870.com and find a geographic number (use your inclusive minutes), or use a payphone (can you still do that?) or a friend/family member's landline and ring them on an 0800 number.

Plus I can never remember the bloody security questions I set up.

Can't help you there. :rolleyes:

socks_uk

wontfallforit wrote: »

Someone at work received a similar letter, but I have mine in front of me, and no mention of re-negotiating the APR. Had you been using your card before you got this?

What's the number you can call? Is it the usual customer services number? And is there a deadline?

Thanks

I'm not sure where the letter is right now but I'm sure I won't have chucked it away. I'll have a look for it tomorrow.

wontfallforit

YorkshireBoy wrote: »

So exercise your right to opt-out and stay on the old rate. Problem solved?

That's the problem...unlike other customers (they seem to be doing this to all customers at the moment), I haven't been given the option...not explicitly, anyway.

MBNA take regular monthly feeds from the CRAs (the fact they've taken these doesn't show on your credit report), and will see your other commitments...including the "large" purchase made for your brother. They may think the risk of lending to you has increased, bearing in mind you're rattling up debt elsewhere. That's maybe why they've rasied your rate, well...that and the credit crunch/state of the economy.

Yeah I can understand the increased risk, BUT,

1) I now have a much better salary than in the past (3 times higher)

2) This large purchase makes debt in my name total £2,500. I've had 5 times that amount of debt in the recent past (& lower salary), yet I've never come across this type of enforced APR increase.

Could just be a 'current climate' concern, who knows. I keep an eye on my credit file, and everything seems in order there (plus, even in my high debt days, I've NEVER missed a single payment).

So get on www.saynoto0870.com and find a geographic number (use your inclusive minutes), or use a payphone (can you still do that?) or a friend/family member's landline and ring them on an 0800 number. :rolleyes:

Ahh, thanks