Interest Rates Doubled!

tracyn

This week I got a letter from Goldfish who've recently been aquired by Morgan Stanley. The letter stated that my interest rate was going to increase from 9.9% per annum to a whopping 21.9%!!!

Needless to say, I've since called and closed the account. No way am I going to pay an utterly uncompetitive rate for credit, never mind more than twice what I was paying before!

This isn't the first time this happened to me. I previously had a Virgin credit card at something in the region of 13.5%, which was subsequently increased to 27% after I'd been with them less than 8 months (after the promo period ended, but the standard rate was still increased!)

This makes me wonder... there MUST be people out there who let them get away with it??? I have a great credit rating and always pay my cards in time, usually in full (except during promo periods).

Otherwise how on earth do they stay in business when it is obvious they are ripping their customers off big time?

MPH80

This makes me wonder... there MUST be people out there who let them get away with it??? I have a great credit rating and always pay my cards in time, usually in full (except during promo periods).

Then why on earth do you care what the interest rate is?

markmc999

It may also be that they are increasing your rate as you never pay charges. They could be holding out that when you do pay interest they may as well make as much out of you as possible

BONJOEY

tracyn wrote:

This week I got a letter from Goldfish who've recently been aquired by Morgan Stanley. The letter stated that my interest rate was going to increase from 9.9% per annum to a whopping 21.9%!!!

Needless to say, I've since called and closed the account. No way am I going to pay an utterly uncompetitive rate for credit, never mind more than twice what I was paying before!

This isn't the first time this happened to me. I previously had a Virgin credit card at something in the region of 13.5%, which was subsequently increased to 27% after I'd been with them less than 8 months (after the promo period ended, but the standard rate was still increased!)

This makes me wonder... there MUST be people out there who let them get away with it??? I have a great credit rating and always pay my cards in time, usually in full (except during promo periods).

Otherwise how on earth do they stay in business when it is obvious they are ripping their customers off big time?

virgin upped your apr? didnt know they did that!!:mad:

briona

BONJOEY wrote:

virgin upped your apr? didnt know they did that!!:mad:

They probably didn't... until now! Looks like all the credit card companies are doing it – where one leads the others quickly follow. Egg and Capital One are among those to hike up the APR [by around 6% on some customer's cards!].

Some people on these boards have suggested that it's because of all the customers claiming back unfair bank charges as well as the recent reduction in overlimit fees etc from £20 to £12... If that's the case, it looks like the banks/financial institutions may just have the last laugh... until customers start leaving them in droves that it, and they have to reduce the APRs again!

topgranny

briona wrote:

They probably didn't... until now! Looks like all the credit card companies are doing it – where one leads the others quickly follow. Egg and Capital One are among those to hike up the APR [by around 6% on some customer's cards!].

QUOTE]

I had an e-mail from Egg this morning telling me that my APR is going DOWN next week by about 3%! Don't know what I've done to deserve that - except perhaps not used it for some time (since I stoozed with it actually).

topgranny

MPH80 wrote:

Then why on earth do you care what the interest rate is?

I would think because upping rates like this is quite disgusting and needs highlighting and also to let others know that it's happening. It pays to be aware of these things, even if it doesn't necessarily affect you.

(Oh goodness, I sound really prim here - I don't mean to, honest!)

Astaroth

briona wrote:

until customers start leaving them in droves that it, and they have to reduce the APRs again!

Competitive is a relative term though.... it wasnt that many years ago when 19.9% was considered a reasonable interest rate to be paying on a CC. If all cards return to the 20% mark then someone offering one at 16.9% will be seen as great rather than poor as it currently is.

Of cause it wont just be APRs that increase but also bank accounts will most likely also start carrying annual fees again - 3 of the big 5 banks CEOs have said that this is inevitable in their mid year results announcements.

MPH80

topgranny wrote:

needs highlighting and also to let others know that it's happening. It pays to be aware of these things, even if it doesn't necessarily affect you.

Fine - but this user went much further - she up and closed her account - for no good reason!

topgranny wrote:

I would think because upping rates like this is quite disgusting

Why? The banks are just trying to make money - don't like it - take your business elsewhere. If a bank wants to up the interest rate I'm paying on a card (which I don't anyway) - I look for another card, I attempt to pay it off or I accept it and move on.

M.

Gordon_the_Moron

tracyn wrote:

This week I got a letter from Goldfish who've recently been aquired by Morgan Stanley. The letter stated that my interest rate was going to increase from 9.9% per annum to a whopping 21.9%!!!

Needless to say, I've since called and closed the account. No way am I going to pay an utterly uncompetitive rate for credit, never mind more than twice what I was paying before!

This isn't the first time this happened to me. I previously had a Virgin credit card at something in the region of 13.5%, which was subsequently increased to 27% after I'd been with them less than 8 months (after the promo period ended, but the standard rate was still increased!)

This makes me wonder... there MUST be people out there who let them get away with it??? I have a great credit rating and always pay my cards in time, usually in full (except during promo periods).

Otherwise how on earth do they stay in business when it is obvious they are ripping their customers off big time?

Unless you have a card with no interest free period (so you pay the balance off in full every month you still pay interest) in which case you are wasting money, or you withdraw cash on the credit card which is ALWAYS a mistake, why worry about the interest rate since you will never be paying interest?

Maybe they have upped your interest rate because you have never paid them a penny in interest and they won't to get rid of you... it has worked!

Paul_Herring

Gordon_the_Moron wrote:

Unless you have a card with no interest free period (so you pay the balance off in full every month you still pay interest) in which case you are wasting money, or you withdraw cash on the credit card which is ALWAYS a mistake, why worry about the interest rate since you will never be paying interest?

Maybe they have upped your interest rate because you have never paid them a penny in interest and they won't to get rid of you... it has worked!

Well it certainly does them no favours when disgruntled customers advertise the fact they're doing this. Incidentally they have upped the rate for those who don't pay off every month aswell