Card interest rate hikes

Wendy1956

I have had a Halifax credit card since 2007. Originally at 15.9%.

Over years this has increased as high as 34.5% and is now at 29.95%

I rang them today to ask why, was told that this is because they take advice from experian about my credit score and adjust rates accordingly. Nowhere in my original credit agreement is it mentioned that they inc/decrease rates at the say so of a third party.

I asked for copies of my statements, they said it would cost me £5 per statement, over £400. So I have sent them a letter asking for notification of interest rate changes.

Anybody see any reason why I should not calculate how much they have overcharged me and take them to a small claims court for the difference.

In effect what they are saying is your credit rare is not quite so good so we will charge you more , they are immoral and greedy people

Tixy

They haven't increased your rates on the say so of experian, or based on a credit score produced by a third party.
What they have done is re-assessed your financial situation based on all information available to them (which includes your credit file with experian which you gave permission to them to report to and search) and reassessed their lending criteria/risk assessment and rates.

You could opt out of this rate hike, just the same as you could have opted out of previous interest rate increases.

You could of course calculate a number and start proceedings against them in the small claims court against them.

eskbanker

Wendy1956 wrote: »

In effect what they are saying is your credit rare is not quite so good so we will charge you more

...but what they're really saying is that the interest they charge you will reflect their risk in lending to you, which is influenced by many factors.

Wendy1956 wrote: »

they are immoral and greedy people

They are people running a commercial business, no more, no less....

Are you saying that the original credit agreement doesn't contain any Ts & Cs allowing rate variation?

grumbler

Wendy1956 wrote: »

...Nowhere in my original credit agreement is it mentioned that they inc/decrease rates at the say so of a third party.

I am sure the agreement does say that they can increase the rate without any reasons whatsoever.

Re the "say of a third party", you were just misinformed by an incompetent phone agent - as Tixy explained above.

cautiousjon

Wendy1956 wrote: »

...
Anybody see any reason why I should not calculate how much they have overcharged me and take them to a small claims court for the difference.
...

I don't see any grounds on why you would take the bank to court.

Wendy1956 wrote: »

...
In effect what they are saying is your credit rare is not quite so good so we will charge you more , ...

I am sure that they are well within their rights to do this, unless the credit agreement that you signed with the company does not state this provision. Ultimately, they have no compulsion to lend you money. If you don't like the rate, you are well within your rights to pay back the full balance, cancel your card and take your business elsewhere.

PeacefulWaters

I can't recall ever seeing a fixed rate credit card agreement. Every credit card I have ever had has been a variable rate. An issuer has to have a specific reason for changing rate.

Here's an example extract from T&Cs on a Halifax card:

We may change interest rates (except fixed rates). This includes changing the way they are charged or calculated, or introducing different rates for different types of Transaction or different types of rate. The new rates apply to Transactions and to your outstanding balance from the date the rate changes. The APR does not take these variations into account.
These changes may be personal to you and based on a number of factors such as increased or decreased credit risk (for example, there will be an increased credit risk if you have regularly failed to comply with important obligations to us) and the way you use your account (for example, we may reduce the number of days between the statement date and the payment date if you always pay off your balance in full).


5.2 We will give you at least 60 days notice of an increase in your interest rates. If we increase your interest rate you may notify us before the change takes effect that you want to close your account and repay your balance at the existing interest rate. If you do so, you must stop making any Transactions, return all Cards and Cheques (cut in half) and cancel instructions or authorities you have given others to charge your account. This agreement will continue until you have repaid all amounts you owe us. If we decrease your interest rates we will let you know before the change takes effect.

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Anybody see any reason why I should not calculate how much they have overcharged me and take them to a small claims court for the difference.

1. You would lose.

2. You could be ordered to pay their legal costs.

3. You'd look silly.