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LloydsTSB Credit card services attempt to push interest up by 5%. Check your account
Marxist
Posts: 3 Newbie
in Credit cards
About a week ago I received 60 days notice on my LloydsTSB credit card service. They WERE putting my interest up by 5% from 19.4% to 24.4%.
Now I'm not adverse to companies changing their borrowing terms, that's fine (as long as they give you notice). However, this also covers money previously spent rather than money you choose to borrow after the increase. Technically a loan sharking tactic, and I have contacted the OFT about this. Lloyds have decided they want an extra 5% per annum back on all the money outstanding... But you may not have to be hit by the increase.
Having jumped on the phone to give my tuppence worth on 'How unfair this all is', and 'I'm going to close my 4 accounts (personal, business, C/card and loan) with you for such appalling behaviour...' I was then informed that MY account actually is of the type that needn't have the increase. I can still borrow on the same old terms as before and be charged the same interest, nothing will change.
"Would you like me to register that you would like to stay on the same rate of interest Mr Customer"... No, call centre graduate, having thought about this since starting my rant 5 minutes ago I have decided I would actually LIKE a 5% increase on my credit card account. After all it's only 5%, and considering your bank has been bailed by the government for several billion I'm guessing you need it!!
Lloyds customers be warned... They are giving 60 days notice of the 5% increase, and in the letter it basically says that if you don't like it then you can close your account. How scaremongering is that?? Yet I have dug my heels in to find that my account is a 'different sort' and therefore I can continue as normal. This is outrageous. Had I continued to the 60 day notice, my interest would be up, and I would be told 'well we gave you notice'.
Understand that there is something you could do to prevent the changes. It only took me a phone call.
The bank is hiding behind 'Terms and conditions' on this one, but it's an unfair term to be allowed to change their interest rates as they see fit, especially on money you have already borrowed, and if it IS in their terms, it should be removed.
I am getting more and more fed up with having to accept T's anc C's for services I want, and then being expected to agree to them all. I get one new 'T's and C's message a moth from Apple to use my iPhone... It's 57 pages long for goodness sake.
If my post can help just one of you get out of this nasty tactical increase, then my post was not in vain. :A
Now I'm not adverse to companies changing their borrowing terms, that's fine (as long as they give you notice). However, this also covers money previously spent rather than money you choose to borrow after the increase. Technically a loan sharking tactic, and I have contacted the OFT about this. Lloyds have decided they want an extra 5% per annum back on all the money outstanding... But you may not have to be hit by the increase.
Having jumped on the phone to give my tuppence worth on 'How unfair this all is', and 'I'm going to close my 4 accounts (personal, business, C/card and loan) with you for such appalling behaviour...' I was then informed that MY account actually is of the type that needn't have the increase. I can still borrow on the same old terms as before and be charged the same interest, nothing will change.
"Would you like me to register that you would like to stay on the same rate of interest Mr Customer"... No, call centre graduate, having thought about this since starting my rant 5 minutes ago I have decided I would actually LIKE a 5% increase on my credit card account. After all it's only 5%, and considering your bank has been bailed by the government for several billion I'm guessing you need it!!
Lloyds customers be warned... They are giving 60 days notice of the 5% increase, and in the letter it basically says that if you don't like it then you can close your account. How scaremongering is that?? Yet I have dug my heels in to find that my account is a 'different sort' and therefore I can continue as normal. This is outrageous. Had I continued to the 60 day notice, my interest would be up, and I would be told 'well we gave you notice'.
Understand that there is something you could do to prevent the changes. It only took me a phone call.
The bank is hiding behind 'Terms and conditions' on this one, but it's an unfair term to be allowed to change their interest rates as they see fit, especially on money you have already borrowed, and if it IS in their terms, it should be removed.
I am getting more and more fed up with having to accept T's anc C's for services I want, and then being expected to agree to them all. I get one new 'T's and C's message a moth from Apple to use my iPhone... It's 57 pages long for goodness sake.
If my post can help just one of you get out of this nasty tactical increase, then my post was not in vain. :A
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Comments
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You need to realise though that not everyone will have the same result as you. The higher risk accounts will still get the rate change, whether they can phone or not.
The 60 days closure is now standard, extended from 30 days - it gives the option for customers not to accept the change to their past borrowing, so don't see a problem with that.0 -
Although a rate rise is never a welcome sight, you have to remember that credit cards are not fixed but run on variable interest rates which means the rate could go up or down as the lender sees fit.
What you have to remember is you did agree to this when you decided to open a credit card account with them and that the rates could go up at anytime.David
£1 of debt is too much for me!0 -
The bank is hiding behind 'Terms and conditions' on this one, but it's an unfair term to be allowed to change their interest rates as they see fit, especially on money you have already borrowed, and if it IS in their terms, it should be removed.
You have the option of closing the account and repaying the balance at the existing APR.0 -
On the contrary, I'm with coolesticeking on this one - it's a variable rate arrangement, so you don't really have any grounds to be upset when the rate varies. It's not like this is unusual for credit cards either - as far as I know, the vast majority of CCs operate in the same way.The bank is hiding behind 'Terms and conditions' on this one, but it's an unfair term to be allowed to change their interest rates as they see fit
Since they've given 60 days' notice, and the customers have the right to reject the rate increases, I don't see anything to get excited about here.0 -
I'm a little confused as I think your post indicates that you think you can keep borrowing at the existing rate. However I don't think you can borrow any more on that card - your arrangement means that they won't jack the rate, but you effectively can't put anything else on the card and will keep paying at the existing rate of interest until the balance is cleared, at which point they will close the account.
Happy to be corrected if I have misunderstood.0 -
I think in this instance, he's been allowed to keep the account open and keep the same rate. The bank will probably have flagged a few accounts as 'let them have the old rate if they complain' because of their value. However, most accounts will just be allowed to close.
He's been lucky this time, but unlikely to get the same treatment next time. I'm already looking forward to that post.... 0 -
On the contrary, I'm with coolesticeking on this one - it's a variable rate arrangement, so you don't really have any grounds to be upset when the rate varies. It's not like this is unusual for credit cards either - as far as I know, the vast majority of CCs operate in the same way.
Since they've given 60 days' notice, and the customers have the right to reject the rate increases, I don't see anything to get excited about here.
I 100% agree with this as well.
BUT it is nice to see the OP threatening to close their 4 accounts with Lloyds, bought a change of heart from them.
Nice for once for the customer to actually be in a position where the bank has to back down or lose their custom. Most people who post, usually have no choice but to accept or close the card and pay at current rate, because of their financial situation.0 -
Perhaps not the exact response I was after, but healthy points made, and a few that I'll admit I wasn't aware of.On the contrary, I'm with coolesticeking on this one - it's a variable rate arrangement, so you don't really have any grounds to be upset when the rate varies. It's not like this is unusual for credit cards either - as far as I know, the vast majority of CCs operate in the same way.
Since they've given 60 days' notice, and the customers have the right to reject the rate increases, I don't see anything to get excited about here.
I never actually knew this was the case that we had a right to reject, and hadn't seen this site's guide to beating rate-jacking. I'm sure many other people don't know this. Don't get excitedness confused with anger here, I'm angry. In the middle of a recession, demanding a further 5% off of people who are invariably relying on money they don't have already is irresponsible. You're already making 20% interest as it is, that's high enough. It's pushing people further into debt, and is immoral. The letter I received stated nothing of a right to opt out unless you wanted to cancel the card altogether.Deleted_User wrote: »I think in this instance, he's been allowed to keep the account open and keep the same rate. The bank will probably have flagged a few accounts as 'let them have the old rate if they complain' because of their value. However, most accounts will just be allowed to close.
He's been lucky this time, but unlikely to get the same treatment next time. I'm already looking forward to that post....
He's absolutely right, because I have a number of well run accounts I have been allowed to opt out altogether, which I have done. However, who in their right mind would not want to opt out? Sorry but if you have managed your money well, and have a right to opt out, then they should turn the tables and make it opt in for their 'risk free' customers. But we all know what would happen there don't we, no one would.
Do you see what I'm getting at? Lloyds know exactly who their good customers are and it would not be difficult to separate the good from the bad and send an extra letter to their good customers stating they will not be affected by this. Instead they are trying their luck and using a rule of numbers. Some will drop out, but most will reaed the well worded letter and feel they can do nothing about it, and we'll just coin the extra money off them. Trust me their letter did not make it obvious that a good customer can opt out, and it wasn't until I pushed it further to a managerial level on the phone that I was informed that I could opt out.
As for variable rates, yes fine that is the agreement. But just because something is in a company's terms and conditions, doesn't mean that it's right. It's a poor choice of timing to make an increase in interest for people. It would be far more sensible that people borrow money based on the interest rate that day, and therefore if the rate goes up, the already borrowed money should stay on the previous rate, and then further purchases charged at the new rate of interest. That is a fair system where the consumer understands what the actual impact of borrowing the money will have on their finances. Being left in limbo and having your rates jacked at anytime is a horrible way for anyone to do business with you.
I contacted The Sun about this issue, and they decided to write about it last Saturday. A nice article talking about whether banks really do have the customers at the centre of their business. I hope it made a few more people call Lloyds and give them some stick.
As I originally posted if I have saved one more person from the 5%, which I think I probably have by now, then I am a happy person.
Oh and I'm looking to still move my accounts from Lloyds if anyone knows of any more real customer focussed companies that I should look at placing my money with.0 -
I have had this letter also. Only they done this to me in November last year too. It went from 20.9% to 25.95% and now they're increasing my rate to 29.45%!!!! That's the same of a store card. I took the card out in July 2007 and my wages have almost doubled since then and if anything my credit rating is better than it was then. I was told that there was nothing they could do about it. And that I had the choice to reject the rate and pay the balance off in full before 10th June.
I am so angry, I registered my complaint with Watchdog after watching their programme last night. Anybody experiencing the same problem with Lloyds, I urge you to do the same. The more people register the problem with them, the more likely they are to look into it.0 -
Checked and my apr on the lloyds air miles card is still 10.4%0
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