A new wave of bad news has hit many mailboxes recently. More banks are sending out notices of interest rates hikes. I got hit with a new one and have gotten emails from people upset about the "change of terms" pamphlet that just showed up.
I followed my own advice and called my bank to play the rate battle game. The first customer service representative went through the speech I've heard before, "The rate increase is due to the current economic climate and there is no negotiating." My only options are to accept the new rate: A whopping 26%!! Or opt out and close the card.
So I requested a supervisor. When she finally came to the phone she rattled off the same thing, but gave me a third option. "Opt out of the rate increase, keep your current lower interest rate but don't close the card, just don't use it." (Closing a credit card may ding your credit rating a bit.) She said to call back in 6 months and perhaps the "economic climate" would be better and I could get a lower interest rate. Basically saying, the bank is pretty much up the creek right now, but they are hopeful things will turn around. I chose option #3: "Hope."
An important note about this option: If you use the card during this "on hold" period you are signaling the bank you want to re-activate your account, which will 'opt you back in' to the higher interest rate. Make sure you change any monthly automated payments you have linked to that credit card, like a gym membership or Netflix, to another credit card ASAP.
Have consumer questions for Mary? She's waiting for your message! Email her at MarySchwager@galtime.com
Mary Schwager is a journalist with more than 17 years experience. She's won more than two-dozen local, regional, national and international journalism awards for investigative, consumer, feature reporting and writing including 10 Emmy Awards and 7 Edward R. Murrow Awards and numerous Associated Press honors. She worked as a television reporter, investigative reporter and investigative producer at network affiliated stations across the country including Cedar Rapids, Iowa, Milwaukee, WI, Indianapolis, Indiana and in Boston, Massachusetts. After graduating from Marquette University in Milwaukee, she also conducted criminal and insurance fraud investigations as a state licensed detective. Mary is a national consumer columnist for Examiner.Com: You can see more from Mary at http://www.examiner.com/x-1893-News-You-Can-Use-Examiner
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