Has your Bank of America credit card APR increased?
After reading a very interesting post by CreditBloggers, I thought I would share it.
As you know, Bank of America acquired MBNA in June 2005 and became one of the world’s largest credit card issuers. There were some technical glitches here and there as consumers had their accounts switched over to the new bank, but the process went pretty smoothly overall. Now, a few months later, Bank of America has been sending term amendment letters to card holders with rate and fee increases. Here are some of the stories we’ve heard:
- Del had his interest rate increased from 7% to 25% without ever missing a payment.
- Karl had his interest rate increased from 8% fixed to 22% variable. Bank of America told him it was due to his “high balance” on the account.
- Devender had his interest rate increased from 9.9% fixed to 19.99% variable with no explanation.
- Jim had his interest rate increased from 9.9% fixed to 25.24% variable. Bank of America told him it was due to his high balance and insufficiently large payments each month.
- Kim had her interest rate on a balance transfer increased from 3% to 22% before the end of the promotional period.
- Mitch had his interest rate increased from 5.9% fixed to 19.99% variable.
- Fiona had her interest rate increased from 9.9% to 23.99% without ever missing a payment.
- Bill had his interest rate increased from 14% to 23%.
- Shaun had his interest rate increased from 7.99% fixed (for 9 years) to 25.99%.
- Tammy had her interest rate increased from 9.9% to 22%.
- Brittany had her interest rate increased from 5.9% fixed (for 3 years) to 11.9%.
With 11 reported cases, this is more of an epidemic than a trend. If you have a Bank of America credit card, and chances are you do, check it today to see if your interest rate has increased. If they have, it doesn’t seem like there is much you can do to convince Bank of America to lower your rates. Your best bet is to pay off your balance or transfer it to an account with a lower APR. Here are few things to keep in mind:
- Yes, it is perfectly legal for Bank of America to raise your rates. Not necessarily fair, but legal.
- If you are transferring your balance, be sure to investigate the rates and terms for that with the new card. 3% balance transfer fees are pretty common.
- Avoid closing the Bank of America card. Closing older accounts can hurt your credit score. It is better to leave it open and unused with a high limit.
- Don’t forget to cash out any rewards or miles that you may have on the account.
- If you let your Bank of America card go “dormant,” don’t forget to check in on it once in a while. Keep an eye out for sneaky annual fees or signs of identity theft.
- If you have complaints about your account, you can send them to the Comptroller of the Currency at