I just heard that B of A is going to charge $50-$100 to customers

[napi21]

who pay off their credit cards every month! I think they said it was to start the begging of the year. Just annouunced by Dr. Nancy Schneiderman on MSNBC. I will look for a link!

Here's ONE link.

http://www.usatoday.com/money/perfi/columnist/block/2009-10-19-bank-of-america-card-fee_N.htm

[rcrush]

1. That makes lots of sense.

:sarcasm:

[roguevalley]

74. or make sure you eat out once a month so something is always on it.

[GodlessBiker]

2. Time to get a new credit card.

[Romulox]

3. Cancel the card.

:shrug:

[TheCoxwain]

41. That is exactly what they are hoping you would do ... you see

paying up every month prevents them from earning interest and other yummy fees like late payments ..

so on the whole your account is a loss making ( or shall we say less profitable ) .. so with the fee - they are hoping you would get out.


BASTARDS

[Romulox]

70. And? Everybody around here is a "free marketeer" (until the market starts acting like a market)

Then it's all "Oh noes!!!!" :shrug:

[reggie the dog]

75. I would pay off all but one cent every month

[fishwax]

85. They usually have a "minimum finance charge" of a buck or two, though

so over the course of the year you'd still pay 12-24 bucks. Bastards.

[reggie the dog]

87. doh!

[fishwax]

72. not always a good strategy, since doing so can lower your credit score

so folks should be aware of that before they simply cancel cards ...

[Romulox]

73. Not really by an appreciable amount. It's dumb to pay an annual fee

on a card on which you carry no balance.

[fishwax]

84. it depends on how old the account is and what your other accounts are like

If you cancel a high credit line card that carries no balance, but you carry balances on other cards, it can significantly bump your credit utilization ration, and canceling an old card can make your credit history look shorter than it would otherwise be.

[Romulox]

90. Under that very specific set of facts, I agree with you. nt

[Jim__]

4. What fee are they charging for cancelling your credit card? - n/t

[and-justice-for-all]

5. Getting punished for paying off your balance?

that like getting fined for not having health care....:shrug:

PS: dump all your credit cards accept for one. I did.

[napi21]

11. In that link there's also a reference to Citi charging those who

pay off their card every month a fee unless they charge at least $2,300/yr. Other banks are starting to charge an annula fee again.

Ditry btd's...

So far my cards wont be affected by any of this...that I know of. I chg. everything on one card because the annual summary is a terrific was to see where you spent your money & as backup for medical expenses for tax purposes too, but if those greedy people decide to chg. me $100/yr for the benefit, the hell with them!

[and-justice-for-all]

24. I have a Citi loan that is fucking killing me...

the interest is bloody murder.

[MissB]

6. That should make them the most sought-after credit card company!

Maybe they are ready to seriously crash?

[Craftsman]

7. Source?

[napi21]

14. I put a link in my OP. Here it is again.

http://www.usatoday.com/money/perfi/columnist/block/2009-10-19-bank-of-america-card-fee_N.htm

This pne isn't MSNBC but USA Today is good too.

[Warpy]

8. A yearly fee shouldn't be that big a burden for the convenience

of a credit card. If people want to avoid it, then they need to open junk accounts with debit cards. That's what I have and I haven't needed a credit card since they developed into a scam in the early 90s.

The fees were $29/year and $99/year. I assume that's for personal and business cards, respectively. It's not a bad price for the bookkeeping service the bank provides.

People are upset over this because they're used to a free ride. The party is over, folks, and it's time to pay the piper.

[Fresh_Start]

17. yes, the free ride is over

before the people who didn't pay off each month were funding the people who did which was extremely unfair to the people who could least afford the expense.

[Warpy]

25. Not only that but their shenanigans in other areas

forced them to accept a government loan. Since the last thing a banker wants is a government auditor looking closely at what he's been doing with other people's money, they're trying to raise all sorts of fees across the board to pay that loan back ASAP.

At least with Ken Lewis gone they have a chance to stay stable and in business.

[Raineyb]

63. Excuse me?

Paying off the bill every month is NOT getting a free ride. Punishing those who try not to carry over bonuses is a boneheaded move. You're buying into the same kind of thinking that the credit card companies use when they call people who pay off their bills in full deadbeats.

:thumbsdown:

[joeunderdog]

83. The banks make plenty of money off the merchants for each purchase. You don't need to pray for them

or blame people who pay their balances each month for the high interest. Poor discretion by banks on who they lend to is a better place to start. They give cards to people they know can't pay it off.

[napi21]

22. I dosagree with you. I chg. everything I buy on one CC, and

believe me, the CC co. makes lots of $$ in the merchant fees on those purchases. I could MAYBE see reinstitution of a reasonable annual fee of $20-$30/yr but $100 is way too high! Remember, 99% of all the recording & processing they do is automated and never seen by a human...especially if you get your statement online. They don't even have any postage fees involved!

I say they should concentrate much harder on eliminating fraudulent card use where they have to absorb the loss if they dont find the perps. I'm also sure they'd have a better net income with that approach!

[Warpy]

33. All amounts are entered into the system by a human being

Take a look at your next credit slip. Anything hand written has to be entered by hand.

Chasing fraud is also labor intensive. It costs more than it nets most of the time.

Remember also, they're trying to repay that TARP money on the backs of their customers. They've hiked fees across the board.

Yearly fees used to be standard on a lot of cards along with 18 3/4% interest.

[smoogatz]

43. Yeah, but not by the credit card company.

They get entered at the point of sale, by the merchant, through Verifone (a service for which the merchant pays a monthly fee). The amount is instantly authorized, then goes directly to the account balance and the monthly statement--all electronic.

What the CC co's are doing is trying to get out front on the CC reform legislation they know is coming down the pike. They're going to have to stop some of the clearly fraudulent and/or predatory practices they've been engaging in, so now they're looking for other sources of revenue.

[Gormy Cuss]

66. Annual fees were a 1980s era experiment that failed.

For a while nearly every vendor was adding annual fees then the tide turned and no-fee cards were marketed as an alternative. Within a few years that killed most of the annual fee card plans.

If consumers cancel cards en masse this will be judged a bad idea again. One of the things that's changes since the last time they tried this is the emergence of debit cards, which give the convenience of credit cards for many types of purchases.

[Occulus]

71. "Anything hand written has to be entered by hand."

NOT true. There is high-speed optical character reader software out there than can process tens of thousands of handwritten items to a 98-99% success rate per hour (you yourself have probably already relied on such a system in another context). It would not surprise me in the least if the large credit card payment centers use such equipment, given the large number of people who have cards in this country. It would also not surprise me that reliance on such systems may be why people send their payments weeks in advance and sometimes still get hit by a late fee, or have an incorrect payment amount applied to the account.

Also, even those who pay their statements online would be subject to the fee, and the only human intervention there is from the person paying the bill. In effect, by paying online, you're doing their data entry work for them.

[seaglass]

81. When I make a deposit of checks at B of A the ATM reads the

check. I would be very surprised if they don't have this capability on the back end.

[DeschutesRiver]

64. Yes, they make money on the merchant fees, just like they with people who make payments

and because people are paying their balance in full, they have zero collection costs for maintaining those credit accounts.

They do very well on those accounts from what I've heard.

[elizfeelinggreat]

Isn't that why cc companies get a percentage of each sale?

I thought that percentage was why so many places will not accept american express now - because their percentage is higher than visa or mastercard?

I know the rewards some cards give are part of the equation also but that is a relatively new perk, isn't it?

[JerseygirlCT]

78. Yup

Amex is always the highest, so many merchants won't use them. But they all take a cut of every sale.

[AndyA]

30. Bullshit. The piper that needs to be paid should be done on the back of the banks.

They have mishandled the way they handle money, overpaid CEOs and executives for making bad decisions, then rewarded them with huge bonuses to retain them. Why the hell would any responsible organization want to retain ANYONE who led that organization to the brink of insolvency?

And now because they're hurting for income we're supposed to just lay down and spread wide for them? No thanks.

As long as people take this shit, it will continue to be forced on us. A mass closing of accounts will be the only thing that gets the message across. Then cries across the nation for new regulations and oversight will make sure this crap never happens again.

We are rewarding bad behavior by telling people to just accept this. There was no free ride, there have always been fees and the bank did have our money to make loans with, so there was a beneficial mutual relationship. Without that money, the banks couldn't have made any loans.

The banks need to be paying the piper, not their customers.

[Matariki]

47. "Free ride"?? "pay the piper"!!?

Banks get what, 5-6% on every transaction made with a card? And the people who pay their balance every month are getting 'a free ride'?

Oy. We'll see how well this works out for the banks.

[Warpy]

53. Fees vary widely from merchant to merchant

and are lowest for high volume merchants with electronic systems. If you swipe that card, your merchant is paying a much lower fee than the one who fills out a slip for you to sign.

When I worked retail back in the dark ages, the latter method was used and the fee was 4% of the transaction. Now there's also a transaction fee plus a lot of other fees. The card companies are getting us coming and going.

That is why my original post told you how to get out of it. The debit card is much cheaper for the merchant because the money is in the account and is competitive with checks in terms of labor and superior in terms of payment.

Card holders have been getting a free ride, their way has been paid by merchants and by card holders who are paying interest. Those days are over.

Get used to it.

[Dreamer Tatum]

69. NOWHERE NEAR that

Interchange is something like 1-1.5%, tops.

And yes, people who pay their balance in full every month do get a free ride.

[DireStrike]

58. What convenience?

Buckle down for a while and save the money that you need to pay with debit instead of credit. If you aren't capable of stopping putting things on your credit card, you have much bigger problems, sadly.

If there is no way to come out ahead on a credit card (or at least not behind), the only reason to have one is to build your credit score. This is not convenience, it is an extra burden.

Debit can do everything that credit can, provided you can save some money.

[reggie the dog]

76. I will just tell the piper to fuck off and pay in cash

what the hell do i need a credit card for anyway? I will just pay cash, I have enough in savings to pay for anthing big like needing a new furnace or something done on the car.

[DianeK]

I just heard that too but

it was not limited to BOA...they also reported that there would be a fee for those who charged less than 2400 a year..I live on a cash economy so pay off all credit on a month to month basis..if they follow through on this I am going to be swimming in debt I never ran up..if I close my credit cards then my credit rating will fall..this is absolutely not fair!

[DrDan]

9. Isn't there a contract associated with each card? Is this going to apply to new cards only?

This is insane. Running off their best customers.

[abelenkpe]

18. Did this to me on a card held since 87

I canceled the card.

Really, I think this is what they want everyone to do. Cancel I mean.

[DrDan]

36. but don't they charge 2% or so to the merchant taking the card?

I would think those that faithfully pay their bills would be bringing in quite a bit of money.

[CountAllVotes]

26. Isn't there a contract associated with each card?

very good point. I have a credit card that I am about to close out. The contract said that there was free shipping and return shipping with said card on items bought from a specific store.

All of a sudden this is no longer the case. I opened said card in January of this year and now they are saying that it was a typographical error and that they never intended to make free return shipping part of the picture.

Needless to say, I am no longer doing business with the company that got me to take out one of their "VIP cards". Damn this makes me angry.

Do we not have any recourse for cards issued to people under a CONTRACT? Where do we go from here? Is there any recourse does anyone happen to know?

HELP.

:kick:

[DrDan]

38. "typographical error" - what a crock

those contracts are scrutinized thoroughly. They do not make typos.

[napi21]

48. If you read the entire contract, I'm sure you'll fine that there's

a clause in there that states the "bank" can change any of the terms at any time. I'm not sure HOW they got away with this crap for so many years, but contracts don't matter.

[CountAllVotes]

57. said "contract" was to be good for 1 year

after January 2010, it would be no more free shipping either way. Hence, no point in keeping this card.

When I called the store that was pushing their VIP card, they played dumb. When I called the credit card company itself, they said they had no knowledge of what the practices of said store are.

It really is a shame because said store was a place I used to do quite a bit of business with. However, that is now over with.

I hate doing business with crooks.

The real sicko part of this whole scenario is that little religious quotes from the bible pop up while you are in the process of checking out.

God damn these crooked zealous bastards! God damn them!

:kick:

[surrealAmerican]

42. The banks always reserve the right to change ...

... the conditions of the contract at any time. The customer must abide by the contract, but the lender can raise interest rates, add new fees, reduce lines of credit, etc. on a whim.

[CountAllVotes]

62. the credit card company has no knowledge of this

when I mentioned breach of contract to the company, they suddenly notified me that they will be crediting the bogus US BANK credit card for the charges that they OWE ME!

:kick:

[Marlana]

52. There is a contract with each card but...

Every credit card company stipulates that they can change the terms at any time, they just have to give you notice (which can be something as small as a little line on your statement or an extra slip of paper in the envelope that the statement came in) at least 30 days in advance of the change. The notices used to be something easily overlooked but I think they're required now to make them more noticeable. I know I've seen envelopes from B of A that say some like "Notice of changes to your account" on the outside before.

[CountAllVotes]

61. they never gave me any notice of any change

and they still haven't. They are saying it was a typographical error. Yeah right! :argh: :argh: :argh:

FUCK THEM and you too US BANK!!!

:kick:

[rucky]

56. The contract reserves them the right to change the terms at-will.

[ProdigalJunkMail]

10. yet another reason to not have cards from major banks...

oh well...glad i continue to NOT carry one.

sP

[icymist]

12. Sounds more like the agressive begging of the year.

:evilgrin:

[tomm2thumbs]

13. time to find a local bank who cares about who comes through the door

instead of a cookie cutter conglomerate

[RebelOne]

15. Well, I will never have another credit card.

I just had a Chapter 13 bankruptcy discharged. I was $30,000 in debt because of credit cards. I became overwhelmed in monthly payments. So after having two judgments served on me and one creditor garnishing my paycheck, I filed bankruptcy. I have learned my lesson. If I cannot afford to pay cash for something, I just will not buy it. The only thing I will buy on credit will be my next car whenever the one I own now falls apart.

[Arugula Latte]

16. They announced they were cutting overdraft fees ... This must be how they're gonna make it up.

Disgusting.

[slackmaster]

19. I pay $75 to keep my HELOC open

But it has a $210,000 limit.

[DeschutesRiver]

65. We also pay $75 to keep our HELOC open, but

it runs out in 2012. And I may cancel it this year because we haven't used it in years.

If we get charged for credit card, I will cancel those as well. As I said elsewhere, they are making a lot of money off the merchant fees from our monthly purchases, with no need to hire people to collect from us due to slow or no payments. If they don't want that income stream anymore, it will be fine with me. I don't need a credit card other than for convenience.

Our bank also used to provide a free yearly summary of charges - now they are charging $5 for it.

[Lex]

20. I haven't ever done business with Bank of America

and I don't ever intend to. They have always been the biggest crooks out there as far as bullshit banking fees go.

[napi21]

31. I agree. I've never dealt with them either! It's getting very hard

to have your checking account with a smaller local bank though. Especially in Ga. all the small ones have either been bought, or taken over by the FDIC and either sold or closed. I still don't have mine with any of the hugh major banks, but Sun Trust isn't really that tiny nor local.

[lpbk2713]

37. Are there any Credit Unions nearby?

I bank with a CU and have never had any problems since I started my accounts (savings and checking) several
years ago. They are under different regs than banks have to follow and they are a lot easier to deal with.

[ddeclue]

21. Take a new bus Gus no need to discuss much drop off the key Lee and get yourself free.

PAY IT OFF! CUT it UP! and mail it back and tell them you're done!

[Nikki Stone1]

23. If this is the trend, I'm cutting mine up.

I'm not B of A so it won't hit me yet....

[Dont_Bogart_the_Pretzel]

27. kick

[Nikki Stone1]

28. Is one partial payment enough for an exception?

Let's say I buy $100 worth of stuff and pay $90. They'll charge me interest on that $10, but that will be less than the $50 fee and I can pay it off the next month. Then I can go back to paying off my card. Would that be enough to get around them?

[napi21]

35. I don't know. None of those details have been stated. n/t

[no_hypocrisy]

29. So I can save $50-100 if I pay 5 cents less than my full balance,

carry over the 5 cents to the next month with say 30% interest of 1.5 cents, multiply that by 12 for the months of the year and only pay $0.18 for the year?

[ProdigalJunkMail]

40. even better...

the 30% is annual...so if you don't pay it off you will owe $0.06 next year...not sure that will work though.

sP

[Tracer]

46. Don't forget the penalty charge for doing that.

I once mis-wrote a check to CapitalOne that was $0.04 off.

Next month, I got an interest charge, plus a penalty, plus a raise in rate.

I called them and literally asked them if they "were f**king kidding me."

It must have shocked them, for they took off all the charges.

[RobinA]

51. I Once

paid a credit card off one day early (on the closing date). Got a late fee for the amount I charged on that day and a finance charge. Plus a threat to cancel my card, which I pay in full each month. I called figuring they were just looking for a reason to cancel me, but the guy turned himself in knots trying to get me not to cancel. I didn't, but I've been slowly switching to credit union ever since. I have a B&A card, but won't for long if this is true. If I have to I will go 100% debit.

[anigbrowl]

77. less than the *full* balance, not the minimum

In other words, keep a tiny balance on the card on which you pay interest, but of a trivial amount. I'm lukewarm on this for obvious reasons, but a $20 annual fee is not too bad - IF the interest rate is decent and you have the discipline to manage the credit properly. Up to now poorer people (who keep a larger revolving balance etc.) have essentially been subsidizing those who pay off in full every month. So the idea of everyone paying an annual maintenance fee is OK in principle...of course how that actually works out in practice is something else again, no reason to be optimistic about that given past CC issuer history.

It might be a small step in the right direction.

[pipi_k]

50. That's what I would do if I had a card with them

which I don't.

And if they ever send me an application, it will go straight into the trash.


Doesn't make any sense what the banks are doing these days.

I have two credit cards...I pay off the full balance on each as soon as I get the bill. One of them...the Chase card...sent me a notification last month that they would be adding an additional seven days to the grace period.

Which I thought was sort of funny seeing as I always pay them off within a day or two and have never needed extra time. It should go to someone who actually needs the extra time...instead, they're probably shortening the grace period for people who really have trouble paying on time.

None of it makes any sense...

[lpbk2713]

32. I dumped them long ago.

They bought ought the bank that I had an account with and it wasn't long before I found out
they charged for every little thing they did or even didn't do. I don't miss them a bit.

[michreject]

34. They just raised my rates to 11.99% from 7.99%

I've had the 7,99% for 7 years.:mad:

[Ms. Toad]

39. Been a customer since 1983.

If they charge an annual fee and I have another alternative that does not (which I do currently), they're gone - unfortunately along with the donation they make to the Rainbow Endowment ( http://www.rainbowendowment.org/ )when I use the card.

[WI_DEM]

44. Yep, cancel the card if they do that.

[smoogatz]

45. We've gone almost entirely to debit.

We carry one CC through our local credit union (9.99%, no zero balance or annual fees) that we keep for emergencies, car rentals and other occasional travel expenses.

[Triana]

49. I will CANCEL that Mofo SO FAST their greedy psychopath heads'll spin

I can get a card elsewhere.

[Bonhomme Richard]

54. The idea that they do not make money from you when you pay..

off the bill each month is ludicrous.
First they make money off your yearly charge, if you have one.
Most important is the fact that every time you use that card the poor schmuck (me) that sold the item to you is paying them typically 3% to 4% on the amount charged. That's money they would not get if you paid by cash or check.
It's all about the greed and how much they can make. It won't work for them unless all card holders were forced to pay the fee.

[yurbud]

55. I've got to finish moving all my business to my CREDIT UNION. Find yours & more at:

http://professorsmartass.blogspot.com/2009/02/screw-bankers-back-switch-to-credit.html

[rucky]

59. Deadbeats!

You "responsible" credit card users need to work harder to help BofA make more money.

[closeupready]

60. Got rid of all my credit cards. So glad I did.

n/t

[euphoria12leo]

67. Cancellations required.

BOFA planned to charge my daughter $99 annually to keep her cc. She cancelled it "hot" out of the mailbox when she took a look at her mail. But she had to use her cell phone because I was on my home phone cancelling my Chase for raising my interest rate. It makes sense to pay off your cc each month if you can. Banks don't see it that way. They want to make money and screw the consumer. They are really trying to stick it to college students.


:wtf:

[Sirveri]

68. They tried to charge me 60$ for a card that was closed.

60$/yr for a 500$ limit. Fuck that noise. I've got cash, I didn't even know why they were pushing their card so hard that month until I found out that was the month they racked up the annual fee. It was fine because at the time we needed it. Now we're sitting on 30k, so screw the card.

[SoCalDem]

79. A fee to USE the line of credit. They are a "service", after all

Card companies know that their heyday is coming to an end..poor folks can no longer afford to keep paying, and wealthier folks are using their services for "free".. they gotta make their money somehow..

If you charge $100 a month in services and pay them $90, the interest on the remaining $10 is minimal...just make sure you always leave a $10 balance-due:)

[aint_no_life_nowhere]

80. More efforts to make money without working for it

More and more, America's number one industry, whether its insurance companies, law firms, brokerage houses, or banks, is to move capital from one pocket to another, to create nothing and to bring nothing into the world, but to grab a piece of the pie on its way by.

[quiller4]

82. B of A has been chanrging an annual fee of $50 to card holders

for years. We just got a letter from B of A re-stating their practice to continue the annual charge at the same rate it has been for years.

We carry a balance on our card but always make 2-3 times the minimum payment each month. B of A has dropped our interest rate three times in the last 12 months and raised our limit in July.

On the other hand I've had a zero balance on my Penneys card for 2+ years and never did carry a balance for more than 2 months. Penneys has raised the rate on that unused card twice in 6 months. It is now at 37% APR. There is no way I'm ever going to use that card again but I'm not closing it because I don't want to reduce my good credit score.

[myrna minx]

86. I'll be out of debt by December 2010 and I can't wait to be

completely free from these predatory bloodsuckers.

[MadHound]

88. Cut up your cards, stop feeding these loan sharks

You will find that your life will be easier and saner if you don't have a credit card.

[saltpoint]

89. Bank of America is in a position to do enormous good in this country and

instead it is one of the baddest of the bad actors.