Advice on HSBC Credit Card please!

LollyLou_2

I've been a member of MSE for some time now however, my circumstances changed back at the start of 2009 when I moved overseas with my husband. Since then, I have not been in full time employment (our choice) and so my OH has been funding my debt repayments which are still standing back in the UK. One of these is a HSBC credit card.

Today I took a closer look at my statement and was shocked to discover that the APR is 21.9%!! :eek: This is the highest of the 3 credit cards I have....:o

What I would like to do (funnily enough) is to try and get the APR reduced and was hoping to receive some advice as to how to go about this.

I have read on some other posts that people have been able to reduce the APR on the existing balance but agree that any future purchases will remain on the existing APR. FYI: I don't use this credit card anymore - it was cut up into very small pieces a long time ago! :rotfl:

If I'm successful at reducing the APR, I would then like to "close the account" so that HSBC don't increase the APR in say 6 months time. However, I would still continue to pay off the balance at the reduced APR.

Has anyone had a similar experience with HSBC that could offer me any advice? I have to be a bit careful as I still have my current account with HSBC and I will probably continue to bank with them when we return the UK later in the year.

Any advice would be really welcome - thank you for taking the time to read!

L.L.

izools

It is normal for a bank / credit card provider to increase your APR if your risk as a customer has increased. They need to cover themselves by way of increased payment to cater for your increased likelihood of missing payments.

Whilst you are 100% confident that you won't miss any payments, the cold hard fact is that a UK resident working full time is a much lower risk than a non-resident working part time. Ergo the APR increase.

HSBC will have advised you on the statement prior to the APR increase that they will be doing this - had you checked / noticed you would have been able to opt out by closing the account to a repayment only account. Unfortunately this opt out opportunity will have lapsed. You can call them to try negotiating a lower APR and if they refuse there's not really anything you can do.

Closing the account to a repayment only one wouldn't affect your current account at all. Only having to set up a reduced payment plan after missing a payment or so would.

LollyLou_2

Thanks Izools....that does make sense. Mmmmmm I'll have a think over the next few days. I'm sure they did send me a letter advising of the APR increase but I probably wasn't as MSE savy then!

I guess I could always just take a chance and give them a call. If they say no then fair enough but I guess you don't get anything without asking!!!

Out of interest, do you think I'd stand more of a chance asking for a decrease once I'm back in the UK?

Thanks once again.

izools

LollyLou wrote: »

Out of interest, do you think I'd stand more of a chance asking for a decrease once I'm back in the UK?

To be honest, the decision to increase / reduce your APR will be based on your credit card and current account conduct, and to a certain extent the rest of your credit file - your residence is unlikely to make a difference really.

But good luck with the phone call! If it doesn't go well you could just switch & ditch to a 0% or Life of Balance rate when you're back home?

LollyLou_2

I've never missed a payment on this Credit Card and my credit file is looking good - a score of 968.

I'm going to be brave and give them a call tomorrow and see how I get on. I'll let you know what the outcome is! Eeeeeek!:eek:

gregdedman

Hi Lolly,

Im literally running out the door to work but am also with HSBC and your circumstances pretty much mirror mine exactly and Im a long way down the road with the bank. Ill tell you all about it when im home but just to let you know, IM the one whos winning with this so there is a way through this. HSBC are playing ball when you tell them certaint things.

Get back to you soon.
Greg

gregdedman

Back again,

Ok, I left the UK to work abroad also and took with me my HSBC credit card debt of £2000. I was keeping up with their minimum payments until I saw that they had increased my APR to 29%.
Like you, I failed to act on the 'opt out' letter but gave them a call anyway (from abroad)
I explained my situation and asked them to completely freeze my interest, which they refused. They did offer, however, to honour the original offer to opt out of my interest rate rise and lower it to 24% but at the same time cancelling my card...no problem!

I returned to the UK and had no job so just could not afford the payments anymore.
I went to Citizens Advice Bureau (and friendly MSE'ers on here) and they advised me to just stop paying. HSBC would bombard me with default letters and demands but ultimately they cannot take money I dont have.
I then went into branch to double check the advise and under his breath the HSBC concultant whispered to do the same. He indicated that HSBC would be pretty much powerless.

However, Im not comfortable with just stopping and not telling so have contacted the charity http://www.nationaldebtline.co.uk/ who were great in taking me through the process of writing a personal budget sheet and providing template letters to send to HSBC offering £1 payments each month.
Initial advice from HSBC was that they could not act until I had missed a payment, but they have actually accepted my circumstances and have agreed to freeze the interest and any charges for missed payments for a period of 180 days by which time they would transfer the debt to collections where a further payment plan would be discussed.

As a back up I applied for Martin's sooperdooper Barclaycard 17 month 0% on balance transfers card not ever expecting to be accepted but was. So im hoping to transfer the entire debt from HSBC and then at least the minimum payments I make are 100% going towards paying off my debt and not on the ridiculous interest.

The staff at my HSBC to be fair were great. Honest, open and sympathetic however the final decision has been made by head office it appears.
In my experience, the whole process requires you to jump through a few hoops but thats not a problem when you can't make the payments.

Id suggest having a pop at applying for the Barclaycard, just to transfer the balance (dont forget small percentage fee for the transfer) then maybe you could clear the debt quicker (£41 of my £52 minimum payment each month was interest!!).
If thats not a problem then go down the template letter and rate drop requests.

I hope that helps, and Im in the final processes of all this so if you need any further advice I may be able to help.

Regards
Greg

LollyLou_2

Woo-hoo!!!!!! Sorry I haven't responded to all your posts. However, just put the phone down with HSBC and they have offered me a reduced APR of 6.9% for 6 months on the existing balance! Cheekily asked whether they could extend that to 12 months but she said the most they could do would be for 6 but to phone back towards the end of that period and they could possible re-new! Am very very chuffed )

AND I also sorted out my mobile phone contract with T-Mobile this morning...I am on a roll today!!

Man, I LOVE LOVE LOVE MSE!!!

LollyLou_2

And thanks Greg for taking the time to explain your situation and what you did. I think my situation was a little different in that we can afford to make the payments no problem, it was just the APR seemed so high. Anyway, I'm more than pleased with the outcome and just wanted to say thanks to you and izools for your help and advice.

Have a great day!

kier333

LollyLou wrote: »

Woo-hoo!!!!!! Sorry I haven't responded to all your posts. However, just put the phone down with HSBC and they have offered me a reduced APR of 6.9% for 6 months on the existing balance! Cheekily asked whether they could extend that to 12 months but she said the most they could do would be for 6 but to phone back towards the end of that period and they could possible re-new! Am very very chuffed )

AND I also sorted out my mobile phone contract with T-Mobile this morning...I am on a roll today!!

Man, I LOVE LOVE LOVE MSE!!!

I got the same reduced for 6 months at 6.9%..........cracking deal!

LollyLou_2

kier333 wrote: »

I got the same reduced for 6 months at 6.9%..........cracking deal!

YAY :beer:

I've had a big smile on my face all morning