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IMHO it's all about the greed of the shareholders. I mean you guys are used to pay like 20% apr. A bank would never survive here if they did that. They just live on the 2-3% fees they get from the merchants. That's one reason why especially the smaller stores do not accept credit card payments.
Same thing with the overdraft fees. You pay like $30 for any overdraft. I pay a flat 6.9% apr only on the days and the amount my account is below zero. That makes only a few cents per month when you keep a minus of let's say 200 € for about a week. ING direct (a Dutch banking group) brought this system to the US, so I guess they will get more and more happy customers over time. Seems like banking in the new world has to be brought back to its roots from the old world companies :-)
I have two BOA credit cards with a 20 year + history, but only because they took over our Fleet and First USA cards. I haven't been charged an annual fee (yet).
A few years ago, BOA switched one of our cards to a Signature Visa, which doesn't report the available balance on your credit report (just the highest past balance). They failed to tell me that and our FICO scores dropped (#@!*%!). Then, I kept reading of long time BOA customers with no late payments suddenly getting their rates jacked up, after BOA started having losses from all the unqualified people they'd given credit to. I called them up and let them know that if our rates went up, we'd be cancelling. We had about $16k on the cards at the time. They never raised our rates. We paid off the balances anyway and haven't paid BOA a penny of interest since. Last week, I went to their website to check my accounts and a third one had suddenly appeared. It was the account number of the old card before they switched it to a Signature card and showed all the current history of the Sig card, except it claimed a balance was due. I have no balance due. I just know it's going to be a nightmare to get it cleared up, given how incompetent BOA is.
We're currently looking for a home to buy, so I don't want anything to change on our FICO scores, or I'd close those accounts right now. They'll be my first call after we close on a house though. I, too, hope to live long enough to see BOA go under. #@!*% criminals.
The $59.00 annual fee is only charged to those with shaky credit. Here is the letter from BOA explaining the charge, and who will get charged the fee. Only a small % of people will get charged, depending on your credit and how you use the account...!! The letter says about 5% of their customersw will get charged.. Bank of America adds card fee | Bankrate.com
"Whether or not a Bank of America credit card customer will be charged the new annual fee depends on a customer's credit risk profile, AP reports. According to the article, customers that carry balances close to their credit limits, have lower-than-average FICO scores or pay late on a regular basis may be charged the new annual fee. Bank of America card customers assessed the new annual fee are also unlikely to have any other relationships or accounts, such as a mortgage or checking account, with Bank of America, according to AP.
According to the CARD Act, credit card issuers must provide notice of certain changes to your credit card account 45 days before they take effect. These changes include adding an annual fee to a credit card account."
Last time BOA had to provide a notice of changes, it said that if you used the card again, you were agreeing to the changes. They slipped it in with that junk mail they send once a week and most people didn't even see it. Criminals.
I don't think I'll be on the list for the annual fee, but I'm still going to ditch their cards asap.
Last edited by Be Free; 04-18-2011 at 12:59 PM..
Reason: formatting
I have been a card holder since 1995. Always pay on time and typically always pay off at the end of the grace period and they charge me $59 fee due to the costs of maintaining my account. I read on the Internet and see this was announced in 2010 due to low profitability on clients who payoff their balances every month. I am being penalized for outstanding behavior. This is for Visa Platinum Plus and similar folk. $35000 credit line.
I canceled with them today.
I guess the percentage they chart the merchant for the transaction is not enough.
I had my "emergency" card canceled for non-use but my main card I put 20k a year on so there is no way they are going to plop a fee on me.
You definitely made the right call but to prevent this in the future just put some expenses on the card instead of paying cash etc.
I must say I'm very surprised assuming you are putting around 6k a year on that card it should be enough in merchant $$$ to warrant no fee.
I try to pay cash anyway at most of the mom-and-pop stores to give them a break.
Last edited by Mathguy; 04-18-2011 at 02:02 PM..
Reason: Just saw newest post.
I had my "emergency" card canceled for non-use but my main card I put 20k a year on so there is no way they are going to plop a fee on me.
You definitely made the right call but to prevent this in the future just put some expenses on the card instead of paying cash etc.
I must say I'm very surprised assuming you are putting around 6k a year on that card it should be enough in merchant $$$ to warrant no fee.
I try to pay cash anyway at most of the mom-and-pop stores to give them a break.
Really? Then you should do the math, Mathguy. They get very little from the merchant fees, and make a lot more charging interest.
Nor do the banks want to make a little profit based on the merchant fees covering their actually costs, they want to make lots of money, and they don't give a damn about the hardship it creates.
Don't be surprise if you are soon hit with an annual fee.
IMHO it's all about the greed of the shareholders. I mean you guys are used to pay like 20% apr. A bank would never survive here if they did that. They just live on the 2-3% fees they get from the merchants. That's one reason why especially the smaller stores do not accept credit card payments.
Same thing with the overdraft fees. You pay like $30 for any overdraft. I pay a flat 6.9% apr only on the days and the amount my account is below zero. That makes only a few cents per month when you keep a minus of let's say 200 € for about a week. ING direct (a Dutch banking group) brought this system to the US, so I guess they will get more and more happy customers over time. Seems like banking in the new world has to be brought back to its roots from the old world companies :-)
I'm going to guess that the bankruptcy laws are VERY different as are perhaps the standards for getting a credit card.
Why don't you link to the ING credit card terms in the United States and show us what they are offering here.
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