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Bank of America... 5 replies

Signs Of A Recession: Bank Of America

  • #1
  • First Post: Jan 23, 2008 9:25pm Jan 23, 2008 9:25pm
I just got a taste of how the situation is getting really bad for big banks and ultimately their customers.

I have a Bank Of America credit card, I had it since January 2006, with an APR or 9%. It never ever changed.

I always pay my bills on time, my credit score is around 700, I do not have any negative things on my credit...I am basically very careful about how I manage my credit and its score.

I just got a letter from BOA saying that my APR will go from 9% to....ready ? 24% !!!!

I immediately called, and a very patient lady explained to me that everybody is getting the same letter, and that this is happening because "the company and its credit analyst are re-evaluating everybody's credit lines."

I wanted a more precise explanation, why from 9% to 24%, why such a huge change, especially when my credit is always improving with time and nothing has changed (no new loans, no defaults...nothing...only difference is my balance getting smaller every month I make payments).

She said that once again, it is not only with me, it is with everybody, and that some are going from 10% to 30%, just like that.

Of course I have the option to refuse such change by writing a letter, which I will, with the condition that I won't be able to use the card anymore, or they will automatically increase it to 24%. Trust me, it's not like I will miss it after seeing what kind of bank they are.

I have cards from Citi, Capital One and WaMu, and so far they did not send anything like that.

Clear sign that BOA is desperately trying to make some extra money, and the horrible thing is that the lady told me "we can increase it whenever we want, it is up to us."

I used to work with them and I know the company pretty well. If you are considering doing business with them, just do me a favour and be careful....

Mr. Future
"Lunch ? Lunch Is For Wimps !"
  • #2
  • Jan 24, 2008 1:14am Jan 24, 2008 1:14am
*nod* Many of these big banks have become very greedy and reckless with their customer's money. The interesting thing is, by raising interest rates... those on the edge will be forced into default.

Maybe they're hoping they can bank on the late fees by clamping down on bankruptcy, but sooner or later ppl just run out of money... and then they're left holding the bag. Billions of dollars in bad debt.

There's just too much money being managed by myopic MBAs. Chasing the quarterly profit statement w/o any concern for the risk. If we did that, we'd all be broke inside of a week. But somehow they can do it and get congressional support.

It's not sustainable tho. Sooner or later, probably sooner at this rate, it's going to hit.
  • #3
  • Jan 24, 2008 9:26am Jan 24, 2008 9:26am
Quoting Rabid
*nod* Many of these big banks have become very greedy and reckless with their customer's money. The interesting thing is, by raising interest rates... those on the edge will be forced into default.

Maybe they're hoping they can bank on the late fees by clamping down on bankruptcy, but sooner or later ppl just run out of money... and then they're left holding the bag. Billions of dollars in bad debt.

There's just too much money being managed by myopic MBAs. Chasing the quarterly profit statement w/o any concern for the risk. If we did that, we'd all be broke inside of a week. But somehow they can do it and get congressional support.

It's not sustainable tho. Sooner or later, probably sooner at this rate, it's going to hit.
Well, once again I am curious to see if my other cards with Citi, Wamu and Capital One will receive the same treatment....but as of now I know for a fact that I will stay away from Bank Of America in the future because I do not like at all how they are handling this, and the answer "we can raise it anytime we want" does not make happy at all. It is like saying "if we need to get money from you, we will, whenever we feel like it." Screw them...never again...
"Lunch ? Lunch Is For Wimps !"
  • #4
  • Jan 24, 2008 9:37am Jan 24, 2008 9:37am
I would be furious. That can't be legal. BofA is the worst.
  • #5
  • Jan 24, 2008 9:37am Jan 24, 2008 9:37am
Mr.F. being an old B of A emp., you may want to lock in your rate for life or a year until you can get a better deal somewhere else....many people have cards with them...and if you look at the card agreement with your lawyer (on retainer of course! HA, HA!) they can raise your purchase rate at will...but, are limited to special bal. transfer rates.....

hope that helps,

mm2
He who hesitates is hesitant....which always leads to bad entries.
  • #6
  • Jan 24, 2008 9:46am Jan 24, 2008 9:46am
I had cards with MBNA for maybe 20 years. BOA bought them out and this kind of stuff started. I'm not happy with BOA.
  • #7
  • Jan 24, 2008 9:47am Jan 24, 2008 9:47am
Luckily i live in a normal country where bank can't do that. This would be a fraudulent activity in France and in whole Europe.

Did you had a look in your card contract to see if they can actually raise their rate as much as they want and any time they want ?

It's time for Congress to stop responding to every request the corporate lobbies make and start to actually work for the people of America.
  • #8
  • Jan 24, 2008 9:54am Jan 24, 2008 9:54am
Quoting melpheos
Luckily i live in a normal country where bank can't do that. This would be a fraudulent activity in France and in whole Europe.

Did you had a look in your card contract to see if they can actually raise their rate as much as they want and any time they want ?

It's time for Congress to stop responding to every request the corporate lobbies make and start to actually work for the people of America.
I couldn't agree with you more. The US should become again "the land of the free", like we are here in Belgium for example!
  • #9
  • Jan 24, 2008 9:58am Jan 24, 2008 9:58am
Quoting melpheos
Luckily i live in a normal country where bank can't do that. This would be a fraudulent activity in France and in whole Europe.

Did you had a look in your card contract to see if they can actually raise their rate as much as they want and any time they want ?

It's time for Congress to stop responding to every request the corporate lobbies make and start to actually work for the people of America.
Obama has this type of banking behavior on his radar. he sees the banks that offer credit cards and engage in this behavior as predatory, and also wants to address the Bush admin changes in bankruptcy law that basically makes CC companies able to crush you with credit rates, put you in bankruptcy and force you to liquidate everything to pay them off.

They must need to raise capital desperately.
  • #10
  • Jan 24, 2008 10:06am Jan 24, 2008 10:06am
Quoting melpheos
Luckily i live in a normal country where bank can't do that. This would be a fraudulent activity in France and in whole Europe.

Did you had a look in your card contract to see if they can actually raise their rate as much as they want and any time they want ?

It's time for Congress to stop responding to every request the corporate lobbies make and start to actually work for the people of America.
C'mon, guys. It's called a free market. They have the money, so they set the terms, and you agreed when you took the card.

If you don't like the terms, cancel the card. It's a free country.

Me, as long as they're loaning me 10's of K bucks at promotional rates (right now 1.99%) and I make 2 - 5% per week trading, it's a no brainer. I'll keep their damn cards and put up with their crap. And smile while doing it.
  • #11
  • Jan 24, 2008 10:14am Jan 24, 2008 10:14am
Oh God...and i thought that was me..BOA is the worstYES.
  • #12
  • Jan 24, 2008 10:14am Jan 24, 2008 10:14am
When I worked with them in retail banking, I found a very bad environment, starting from the big regional managers, all the way to the branch managers.

Extremely sales oriented, nothing wrong with that, but way too aggressive for my taste, where often rules were suddenly erased at their convenience. I'll never forget how some managers would give the client a "break" and open an account even with only one ID (two are needed, it's the law...it's part of KYC, Know Your Customer...) just to reach the daily quota.

I worked at WaMu after that, and currently at UBS, and I've never, ever seen anybody doing anything like that.

Also on fees, BOA has the highest fees in the industry, and keep charging as much as possible on accounts whenever they can, it is a scandal.

This should be stopped, it is getting too far. Me talking about it here, at least I am warning some people, but politicians are needed to make a change because it is not fair. The whole reason of having a good credit is to get good rates, and now look at me, being treated as a regular Joe with a crappy credit score, when in truth my score is pretty good. Not fair at all.
"Lunch ? Lunch Is For Wimps !"
  • #13
  • Jan 24, 2008 10:26am Jan 24, 2008 10:26am
Quoting MrFuture
This should be stopped, it is getting too far. Me talking about it here, at least I am warning some people, but politicians are needed to make a change because it is not fair. The whole reason of having a good credit is to get good rates, and now look at me, being treated as a regular Joe with a crappy credit score, when in truth my score is pretty good. Not fair at all.
"Politicians?" "Fair?" In the same sentence?

Reminds me of the big government program a few years back to force mortgage companies to give out more loans to subprime borrowers. Hillary was one of the big pushers of this wonderful "fairness" program.

Whenever the government tries to make something "fair", look out! It's always a disaster. The repercussions last for years, or forever.

Furthermore, it's not the government's job to make anything "fair". It would be more their job to protect the rights of the company to do as they choose with THEIR MONEY and run THEIR BUSINESS as THEY see fit.

How is everything the government's responsibility? If you don't like BOA, get out your scissors and cut up the damn card. Wouldn't that be easier than having laws passed which will just backfire on us anyway, as they always do?
  • #14
  • Jan 24, 2008 10:40am Jan 24, 2008 10:40am
Quoting blueruby
"Politicians?" "Fair?" In the same sentence?

Reminds me of the big government program a few years back to force mortgage companies to give out more loans to subprime borrowers. Hillary was one of the big pushers of this wonderful "fairness" program.

Whenever the government tries to make something "fair", look out! It's always a disaster. The repercussions last for years, or forever.

Furthermore, it's not the government's job to make anything "fair". It would be more their job to protect the rights of the company to do as they choose with THEIR MONEY and run THEIR BUSINESS as THEY see fit.

How is everything the government's responsibility? If you don't like BOA, get out your scissors and cut up the damn card. Wouldn't that be easier than having laws passed which will just backfire on us anyway, as they always do?
Of course I can cut it, and I will, but I DO have a choice, what about those who don't ? Those who have a huge balance and maybe cannot transfer it or whatever ? It is simply not fair to change the rules like that, just because they are in deep poo poo and need to make some emergency money.

As far as politicians, I mention them because I definitely cannot pass a bill or anything like that, they can...this does not mean they are fair or good. I am well aware that many of them are just a joke....
"Lunch ? Lunch Is For Wimps !"
  • #15
  • Jan 24, 2008 10:44am Jan 24, 2008 10:44am
...and just to be clear, this thread is not intended to represent my furstration on this issue, even if at times it might seem like it, but my ultimate goal was to focus on how this "recession" and the banking industry crisis is starting to show its results on us, customers. 9% to 24% to me seems like a very drastic and desperate move on their part, especially on somebody with a 700 credit score. I tought it might be Forex related since we all know how all this madness is affecting our trading etc....
"Lunch ? Lunch Is For Wimps !"
  • #16
  • Jan 24, 2008 11:10am Jan 24, 2008 11:10am
Good idea, let's triple the burden on our customers, that'll ensure we get long term paybacks and don't lose our customer base by forcefully defaulting them 2-3 years down the road!

Surely the overall result will be more buying power from this!
3x more money paid to...er...no use...for, er...nothing.
For having money to spend.

Paying money in order to have money to spend with is kind of a bad concept if one thinks about it..bit of a slightly inefficient endeavor one might say..

Not only is the money gone once it's spent, but suddenly there's what you spent x 30% missing again, before the point where you try to find new money to spend again..

Uhm.

Best not to think about the concept too much, it scares me
Trust price. Know yourself.
  • #17
  • Jan 24, 2008 11:14am Jan 24, 2008 11:14am
This is a free country. No one is forced to use one bank or another. And no one is forced to use any credit card whatsoever. Other than exceptions like renting a car.
  • #18
  • Jan 24, 2008 11:17am Jan 24, 2008 11:17am
The way to a higher credit score is not having credit cards from 4 or more different lending institutions.
  • #19
  • Jan 24, 2008 11:18am Jan 24, 2008 11:18am
An example of the "Golden Rule" in action. He who has the gold makes the rules. Once you realize that corporations have the GR cemented in as one of their foundation stones you'll be better able to deal with them. They will squeeze until it becomes un-profitable for them ... but that doesn't mean we have to stay around to be squeezed. There are always other options.
  • #20
  • Jan 24, 2008 11:19am Jan 24, 2008 11:19am
Quoting SeekingLight
Good idea, let's triple the burden on our customers, that'll ensure we get long term paybacks and don't lose our customer base by forcefully defaulting them 2-3 years down the road!

Surely the overall result will be more buying power from this!
3x more money paid to...er...no use...for, er...nothing.
For having money to spend.

Paying money in order to have money to spend with is kind of a bad concept if one thinks about it..bit of a slightly inefficient endeavor one might say..

Not only is the money gone once it's spent, but suddenly there's what you spent x 30% missing again, before the point where you try to find new money to spend again..

Uhm.

Best not to think about the concept too much, it scares me
...I know, they think the solution is to give more money to people, so they will spend it and support the economy....what a joke....please, for the love of God, if you DO get that extra money, SAVE IT !!! Forget about your flag, forget about your President...this is not post 9/11 Christmas, were spending had a "patriot" meaning and was somehow justified after that horrible tragedy. No, this is a recession caused by predatory lending and a lack of regulations. If you spend it, you simply play their game. Keep it for yourself and save it.
"Lunch ? Lunch Is For Wimps !"
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