how can credit card company do this to me?

Question

I have a VISA credit card with $2000 credit line. When i signed up for it, the APR was very low. However, in the past month i went over the credit line accidentally and didn't know about it.

So i got fined $40 for going over the line and then my APR skyrocketed to 35%. It more than tripled only because i accidentally went over $2000 in the last month. I do not have health insurance so i used my card for medical treatment of bone fracture when some car hit me and didn't stop even though i was standing on curb.

I now see that the minimum payment became like $200 all of a sudden. Before it used to be that minimum payment was never more than $15 to $20.

Based on this kind of increase, i will never be able to pay anything more than minimum payment.

Why was i not told that if i go over credit line then APR rate will explode?

Also if accidentally for first time i went over, due to medical emergency shouldn't the visa credit card company be considerate enough to forgive?

i don't make much. i'm still 5 to 8 months away before i finish my major and graduate.

i have credit score of 711 and there's no bad thing on my credit report.

Answer 1

Read This!!

Okay good news, call them up tomorrow and tell them your calling to cancel your card when they ask you what they can do tell them your transferring balances due to interest rates. Works every time. Be very nice to who ever you talk to. and they will offer you give you another chance.

Answer 2

Oh, it's all in the fine print. I'm sure if you read the tinny tinny print on the info that came with the application that this whole 35% thing is spelled out there. :-(

Here's the dumb thing - if they are going to have a limit like that, they should decline purchases. Did you go over because your interest pushed you over? Minimum payments, in some cases, may not even cover the interest (i.e. you can be paying but still have your debt grow).

Call your credit card company. Typically they will work with you in some way.

Your state may have a maxium APR that is allowed by law. Many states this is like 21%. So the 35% may not be enforcable in your state. Find out what your state's law says.

Minimum payments are a bad deal. If you were making the minimum of $20 every month, that takes like years to pay off. Credit cards, in and of themselves, are lousy instruments of credit. You probably would have gotten a better APR from the hospital. They typically would allow you to pay on a payment plan, and may not have even charged you interest. If they did charge you interest, it would have been way lower than 35%.

Well, what is done is done. You need to talk to the credit card company about this problem and see what they can do to work with you. Then you need to pay this off as fast as humanly possible. Then, you need to stop using the credit card.

Dave Ramsey has an execellent class called "Financial Peace University". Take it if you ever get the chance - it will be extermely helpful, especially for someone like you who is about to enter the workforce. He has a radio show too, maybe you can find a station in your area that carries it and listen to it. Probably pick up a lot of good tips there.

Answer 3

First, the bad news, you were told of all the bad things that can and often do happen when you "default". This was all in writing, in fact you agreed to these usurious rates and fees! It is all of that fine print in the cardholders' agreement, that you accepted the first time you used your card.

If your account has been in good standing, a call to the card issuer may get you some relief, but do not count on it. APR rates on this card may also be adversely effected by how you perform on other obligations that are part of your credit report. In essence best advice for future is, use your credit very cautiously. Now, call the company and see how you can best work this out. Good luck!

Answer 4

Credit card companies should just be avoided. They will do anything they can to keep you in debt. The minimum payment will aways keep you in debt, an be reduced as you pay it of. Credit card companies in their agreement state that the agreement could change at any time and at their discresion - so yes they can get away with and it also states the charges for overspending. Theres not alot you can do. If you think your going to find it hard to pay of, take out a loan which will be at about 15% apr, use it to pay of the credit card, cut the credit card up, put it in an evelope with the letter stating the APR increase take a big black marker an write F**K OFF across it send it back a pay of the loan in easy cheaper installments.

Answer 5

Credit card companies, like banks don't care. They want you in debt. If you look at your credit card application, you will probably find this information in the fine print. No one ever reads the fine print, and that is what they are counting on. Go and see your bank manager asap and ask how this, if it can, be changed.
I gave up credit cards 10 years ago, and I would never ever have another.. I have a rule..if I can't pay cash for it, I can't afford it. I don't owe a single cent and I sleep well.

Answer 6

You should have read the fine print. The credit card company does not care what the reason was You can try to call them and explain what the reason was and try to work something out; but my guess is all that was in the very fine "you need a magnifying glass" to read it print. Good luck.

Answer 7

The little disclosure notice that comes with every credit card has all the details in it. Most people like you don't read it. What they did was in the agreement you signed when you got the card.

Answer 8

They can do it and you were told in the "fine print" (either hard copy or electronic) when you accepted the card. Is it fair? Perhaps not. But it is legal - when you busted your limit, you trigger the "default rate" interest adjustment.

Answer 9

When you signed up, you received "promotional" terms and you agreed that if you broke certain rules, the promotion would be discontinued and the account wold convert to standard terms. You did read the rules before you signed up, didn't you?