Update: 12/18/09 - Citibank just slashed my AT&T Universal Card credit from $20,000 to $1,000. My only answer is to transfer all my 'real' funds from Citibank to another bank. This is really outrageous.
Update: 11/10/09 - This article published in the NYTimes.
[This to the Times, but to anyone else who has this problem - start writing: your congresswoman or -man. Your newspaper; on your blog. Write.]
Is anyone covering or has anyone covered - or does anyone plan to cover - a story about the AT&T Universal Card (Citigroup) raising interest rates from, in some cases, below 7% to over 29%*?
This happened to me recently: I noticed that my APR had gone from 11.9% to 18.9%. When I called to ask what had happened, and to ask to have it lowered, I was told that it was the result of a change in the credit card agreement, which I had not read. I was told that, in fact, the APR would go to 23% unless I rejected the change in terms - in which case my account would be closed at the end of its lease, so to speak.
I was dumbfounded.
This for a customer who has never been late, never been over the limit and who, in fact seldom uses the card. It is one of two credit cards I own.
I am lucky, as I have a low balance and can easily pay it off, which I have done, ahead of closing the account. I was told on the phone that I could close the account and then pay it off! Following this awful advice would have damaged my credit rating. As it is, closing one of two credit cards will probably lower my credit rating, but I cannot, in good conscience, keep a card that rewards its customers with robbery. What about people with significant balances, paying as agreed? Haven't the banks just BEEN bailed out? Who created the mess we're in???
A cursory trip through the Web shows on blogs and in chatrooms* [29% mentioned here] that this phenomenon is widespread. My blog gets hits every day from people googling AT&T APR since I posted about this. People are being fleeced. Good customers, not delinquents.
I am deeply disturbed. In fact little has unsettled me as much as this has. What are the wider implications? Is it being done for an immediate pay off, regardless of lost customers? Does it contain even fragments of the makings of a class action lawsuit? Who else will follow suit?
I've just become an American citizen. I am learning that some animals are more equal than others.