News, Credit card firms pay some clients to close their accounts. (rates, charge)

[JD59]

NEW YORK — If you've recently been offered cash from a credit card company to reduce your debt or close your account entirely, be forewarned: Your business may no longer be wanted.

"What the card company is saying is that right now we're playing nice, but if you don't take it, we might start playing hardball" by raising rates or cutting credit limits, says Justin McHenry, president of IndexCreditCards.com.

Credit card firms pay some clients to close their accounts - USATODAY.com

[grannynancy]

AMEX did that to me - I got one of those way low offers a few years ago and used it to pay off a higher interest debt. It was good "for as long as I had the card" - Been paying it off at about twice the minimum payment - balance around 4K.

Of course silly me, I have not used the card for any purchases which is what they wanted so they could charge me the higher interest for purchases and your payment always goes first to the lower interest debt so you can accumulate more interest on the high interest one.

So, the offer did not look so good to me

They agreed to this offer as long as I held up my end of the deal which I have done. I figure if I am late really once they would put the screws to me so I always pay online and print the confirmation.

I don't know what my recourse is if they jack my rates since I have complied with all the terms.