On DMP and Barclaycard have increased my interest rate to 1%

ginormousflares

Hi everyone, I'm on a DMP with Payplan and this morning I received a letter from Barclaycard telling me that they will increase the interest rate on my account to 1% from 8 Mar 08 and that they may increase the interest rates in 6 months time. Is this usual beahviour as my DMP as been pretty steady over these last 22 months, all interest being frozen etc. I have asked Payplan for advice just thought I would let you know in case anyone else has seen this. Cheeoirs GF

boredofbeingathome

I have heard of companies applying interest to accounts but usually this in the first few months until DMP kicks in. I think maybe you should also speak to barclaycard if no joy with payplan.

Gemmzie

How weird, 1%? I'm guessing but I wonder if it's a test to see if you'll let them without fuss so they can wack it up again later

ginormousflares

Thanks Peeps. WIll let you know how it goes.

hypno06

Hmm...gemmzie has an interesting point. Make sure you call payplan as soon as you can - at least to make your position clear. You don't want them putting up rates again, even if you end up stuck with the 1%.

good luck hun xx

ginormousflares

Thanks hypno, this is the answer that I got from Payplan which may be worthy of note for others in a simlar position or are approaching the year point in their DMP with Barclaycard:

Please note, They now have a new policy in place, after a period of time ( usually a year ) the accounts will refer back to the contractual state, so that the account goes into arrears, then the interest and charges will be reapplied. Please note we believe this is for a maximum of 6 months whilst the account is passed to an agency, once the account is with the agency this should be better, as they have the scope to be able to freeze interest and charges, also to except the lower offers.
Please also be advised, this may change their process if the payment is to be increased, however we would need to find this out at the time of the increase.

This is their new policy and we are unable to challenge it at the moment.


So it would seem that it is a temporary measure and 1% is better than the standard APR I suppose and once the DCA take charge of the debt Payplan would seem to have greater negotiating power and the interest charges re-froze (He hopes) plus I intend increasing the offer in Apr (2 year point) significantly. GF

hypno06

It looks as though Payplan are quite positive about it then.

Does that mean that the DCA phonecalls/letters will start again? If so, it will be worth getting *ready* for that element of it.

However, that should at least allow you to obtain some bargaining power, so hopefully you will actually be debt free much quicker!

ginormousflares

Yes it would seem that a raft of ohonecalls are inbound. But I only have a Barclaycard Visa and a Mastercard Visa so it shouldnt be too excessive once Payplan get involved.

Bunnyinthelights

I hope this doesn't happen to me...