Bank of America jacking rates on credit cards. (credit card debt, loan, debt)

[70Ford]

How deliciously devious. Jack the rates...and at the same time.. offer the "old rate" until the consumer pays off the card. Which basically is just a regular signature bank loan at a (most likely) pretty crappy interest rate.

That's slick.

Bank of America also benefits from consumers who do write in an agreement to pay off balances at the old rate and not use the card again, says Nathan Powell, a credit analyst at New York-based research firm RiskMetrics Group.

The bank, he says, is clearly trying to protect itself from worsening credit-card charge-offs ahead, something analysts widely expect in the card industry as the economy deteriorates. Powell says the bank must have identified a list of other credit criteria besides FICO that it is using to screen cardholders and determine it's no longer worth new business if they don't accept the higher rate.

So far, Bank of America's charge-off rates have risen in line with the credit-card industry, up to 5.08% of receivables at the end of the fourth quarter from 4.57% a year ago. "The bank doesn't want to get behind the curve," Powell says.

I don't really care... (<--don't carry a balance).......but you might.

Dunno if I can link to the article on BusinessWeek: Daily & Breaking News, Top Stories from BusinessWeek News

Just Google = = = = "banks boost credit card rates"

[Humanoid]

I read about this a couple of days ago, I'm curious what criteria they are using. They undoubtedly want to protect themselves from the people who are having their mortgage reset. These people seem to try to buy some time by using their credit cards to pay for things.

Unfortunately I just moved all of my unsecured debt to a BofA card with a really low rate, it will be annoying if I have to move it around again or pay it off more quickly.

[AliceT]

Originally Posted by Humanoid

Unfortunately I just moved all of my unsecured debt to a BofA card with a really low rate, it will be annoying if I have to move it around again or pay it off more quickly.

I've had an account with them for years. As long as you pay off your balance every month - no interest charge whatsoever.

[Lindsey_Mcfarren]

Originally Posted by AliceT

I've had an account with them for years. As long as you pay off your balance every month - no interest charge whatsoever.

My Dad taught me alot of things, don't buy something you don't have the money to pay for. Do as Alice says, pay it off at the end of the month to help your credit rating. If you leave the balance and carry it, with the interest on it, you could end up paying twice or more what the item cost you.

I have NO credit card debt and I am proud of that.

[msina]

Bank Of America acquired a lot of new debt when they bought MBNA. With the worsening economy they are reassessing debt risk (by their own criteria). I don't have credit card debts but I did work in a bank with credit card debt and I know the practices are predatory.

[Lindsey_Mcfarren]

Originally Posted by msina

Bank Of America acquired a lot of new debt when they bought MBNA. With the worsening economy they are reassessing debt risk (by their own criteria). I don't have credit card debts but I did work in a bank with credit card debt and I know the practices are predatory.

They do it to make money, DUH.

[Humanoid]

As long as you pay off your balance every month - no interest charge whatsoever.

The point of my comment was that I have a balance with them, in fact all of my unsecured debt I transfered to the card because it has a low rate. If I was paying the balance each month I would not care.

Do as Alice says, pay it off at the end of the month to help your credit rating.

My credit rating is just fine. But the point of the original post is that they are now using other criteria to adjust rates (they have always adjusted rates if they notice your credit rating is going down). At the same time they are not saying what these criteria are, which is unfortunate.

[rich renter]

great news hopefully they will start jacking up the interest rate on my savings account. spmehow i doubt it

[KevK]

All BOA has ever done is rip off people. I don't know why anybody would do business with them. They are the ones that started the new $3 ATM fees. True their customers don't pay it BUT all the other banks followed suit and not BOA customers will pay it when they use another bank ATM. That means that to get $20, it will cost you $6!

[Humanoid]

I don't know why anybody would do business with them.

They are a relatively healthy bank and at least around here they have ATMs everywhere. I have never been ripped off by them either.

great news hopefully they will start jacking up the interest rate on my savings account.

Unless you like losing your money, having a savings account with a standard bank is pointless. Move the majority of your savings to an online bank.