Chase Decides To Raise Credit Card Fees
J.P. Morgan Chase is about to pull a fast one on 400,000 of its credit card customers. The giant bank and financial services company recently announced that they would be imposing a $10 a month account service fee on cardholders that took advantage of their balance transfer deal.
Do you remember those? It wasn’t long ago that banks and credit card issuers were falling all over themselves offering balance transfer promotions. The standard offer was that if a consumer transferred their balance from another card they would get a low interest rate locked in for as long as they carried that balance.
Over the past 10 years Chase picked up approximately 400,000 new account holders through this offer. It was a common promotion designed to lure in new customers in the ultra-competitive credit card market. In return for transferring their balance, Chase promised not to increase the APR on the promotional offer.
By now, with the economy locked in this horrific recession, credit card issuers are scrambling to raise money in any way they can. Because they promised not to raise the interest rates on those balances that were transferred they have decided to charge a monthly fee.
Because of the current credit crisis credit card companies are taking a big hit in their once bloated profit margins. But charging monthly fees was never a part of the original agreement so you guessed it, a class-action lawsuit has been filed by the cardholders that are effected. The courts will decide this one.
In addition to the monthly fees, minimum monthly payment amounts will also be doubled for some customers. Chase is offering an alternative to its cardholders – a 7.99% APR with no monthly fees and no doubling of the monthly payments. Strong arm tactics indeed.
Credit card account holder protection is on the way but not until July 2010. Until then the credit card companies will do whatever they can to increase their bottom lines. You can of course, have the final say in the matter by simply paying off your balance and telling the card company what they can do with their interest rates and fees.
Related Information:
- Higher Credit Card Fees Introduced By Banks The trend is not good for credit card account holders as banks continue to raise fees on them....
- Credit Card Issuers Getting Creative with Their Fees Credit card issuers are finding new ways to charge their account holder's fees...
- What to Do If You Suddenly Get Hit With Credit Card Fees Credit card fees are becoming more and more popular. Read our article to see what you can do about them....
- Credit Card Balance Transfer Fees Are Going Up Balance transfer fees are becoming more and more expensive....