What's in your wallet?

| I've had a CapitalOne credit card for many years, since 2002 at least and possibly before. I originally signed up for the card because they made me a great offer:

Offer, early 2002
CapitalOne offer, early 2002

"No" never sounded better: What's not to like about no cash advance fees, no balance transfer fees, no annual fees, no foreign-exchange fees, no telemarketing? At the time I was carrying a big balance on another card, so I took advantage of the offer and transferred it over at a very sweet introductory rate.


By and large, I've been very happy with the CapitalOne card; although it went through several incarnations over the years — "No Hassle Miles," "No Hassle Rewards," etc. — the basic terms that were so appealing didn't change: the same low fixed rate on both purchases and cash advances, and no fees. I seldom used the card for purchases, but I did use it a lot for managing credit card balances, often at very good special rates.

A couple of months ago I began to get letters from CapitalOne practically begging me to let them make my account more attractive. What would I like — miles? lower rate? bigger credit line? whatever? Finally I responded and they did sweeten the deal a bit. In December they lowered my rate for purchases to 0% for six months and gave me a special rate on a balance transfer. Not awe-inspiring, but a nice deal nevertheless.

Last week I received an "important notice of a change in terms" for my account:

Due to extraordinary changes in the economic environment, we're reviewing our existing credit card accounts. Having considered these economic conditions, your account's current Purchase rate, and the length of time you've had this rate and account, we will be changing your Purchase and Balance Transfer rate.

And what would those new variable rates be? Beginning April 2009:

Oh, and if I were to default? The new rate would be 29.4% (Prime + 26.15%)


From my point of view, I'm a pretty good credit card customer: I often carry big balances and I never miss a payment. That must be so wrong, else why would they do this to a "good" customer? In fact, "excellent" (right).

The credit card industry is badly in need of re-regulation. It is simply wrong that a credit card company can unilaterally, for no reason, change the terms of the agreement with them. It is simply wrong that a credit card company can increase rates by 227% for someone with good credit.

Wrong, wrong, wrong!

Last updated on Apr 13, 2018



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