Barclaycard interest rate skyrocketing!

Pernicious

Hello, I'm hoping someone out there a bit more saavy when it comes to credit cards can help me please...

I recently received a letter from Barclays informing me that my interest rate would be going up from 19.9% to 24.9%. I have asked them if they can offer me anything better & they are refusing. I have just asked about other customers being given a standard offer of 6.9% for the life of the balance, with a 2.9% fee but was told he personally cannot do this for me, but when I asked if I could speak to their retentions department who might be able to, he gave me a number that does not exist! I'm really unimpressed with the level of service considering we have never missed a payment & have been making more than the minimum payments.

I don't think I will be successful in transferring the balance to another card provider & so I'm at a bit of a loss on what to do. Everytime I say I don't accept the new interest rate I am basically told their only option is to close the account but no one can tell me what exactly this means - does it go to their collections department? As I don't have just over £4k to hand over else I would have done so already! Does it just sit at the 19.9% balance & I pay it off as normal?

Any help or advice would be greatly appreciated right now, thank you.

YorkshireBoy

Pernicious wrote: »

Everytime I say I don't accept the new interest rate I am basically told their only option is to close the account but no one can tell me what exactly this means

The letter should say this (have you read it...in full?), but 'closing' the card only closes it to new transactions.

In effect, you can't use the card anymore in order to stay on the old rate of 19.9% APR.

Your credit history/rating with the CRAs is unaffected by taking this option.

cos_2

If you opt to reject the increase then it means you can't take any more credit from the account (you must stop using the card) but can pay the balance off within the current terms and conditions, including the 19.9% interest rate.

It won't go to collections - you can make minimum payments if you wish.

Pernicious

Thank you for confirming, I thought that was the case but a friend was telling me it would go to the collections department & no one at Barclays would explain what would happen to it, they just jumped to "Ok we'll close it" & then didn't when I asked what that meant exactly. I don't intend to spend on it at all anymore so I will just ring up again & close it.

Once it is closed am I able to transfer the balance should my credit rating start looking a bit better & I think a balance transfer would be accepted?

alfred64

Make it clear that you are 'opting out' of the proposed interest rate increase.

Hobsonp1967

I had exactly the same letter today. I have held my Barclaycard for 18 months, and have always paid more than the minimum required and always on time. I was furious that they wanted to increase my interest rate by 5% (a 20% increase) so rang to close the account and pay offat old rate.

After waiting 15 minutes to speak to someone, I was informed that these letters were computer generated and that the person on the ohone had personally reviewed my account, and had overrode the increase.

Give them a call and remain polite, make it clear you eill be clising your account, and if you have kept your account in good order chances are they will cave in.

After all can banks afford to loose loyal customers?

I will be paying mine off anyway, and switching to the Cooperative. I bank with them for 1 year now and think they can show the big 5 a thing or two about service!!!

Good luck

Phil

[Deleted User]

Hobsonp1967 wrote: »

Give them a call and remain polite, make it clear you eill be clising your account, and if you have kept your account in good order chances are they will cave in

Good result for you, but you would have been in a very small percentage of accounts they were willing to revert the rate on.
Most customers will be allowed to close their accounts.

opinions4u

After all can banks afford to loose loyal customers?

Yes.

Yes they can.

Especially if they're debt carrying customers.

Google "Credit Crunch" and "bank wholesale funding" for a more detailed explanation.

chattychappy

Pernicious wrote: »

Once it is closed am I able to transfer the balance should my credit rating start looking a bit better & I think a balance transfer would be accepted?

Yes. If you get an offer from elsewhere you could still transfer the balance from Barclaycard to take advantage of it.

Hobsonp1967 wrote: »

I had exactly the same letter today. I have held my Barclaycard for 18 months, and have always paid more than the minimum required and always on time. I was furious that they wanted to increase my interest rate by 5% (a 20% increase)

Why furious? The interest rate isn't a reward/punishment for good behaviour or a reflection on your character.

They are simply hoping to make more profit from you - many people would go on paying. If I was a shareholder I would be "furious" if they didn't take these opportunities. But in your case you weren't fooled - you phoned them up and did a deal. I'd be cool about it and keep the account open.

Imagine if the banks got "furious" every time people suddenly paid down debts....