So, last week, I’m looking at my Citibank account. The one that really tried to screw us by raising our interest rate. I see that the rate on our account is 9.24%. The following is our correspondence (their answers are in italics):
Why does my interest rate show as 9.24%? Is that an actual rate or does it go up to 16.99% if we actually use the card? I miss using my Citibank account, but there's just no way to justify the higher interest rate I'm afraid you'll charge.
Our records indicate the Annual Percentage Rate (APR) for purchases on this account is currently at 9.24%. This variable APR is based on the prime rate (currently 3.25%) plus 5.99%.
The reason I ask is in December, I received a notice that if we used the account, that we were accepting the new terms of a 16.99% APR, which is why there has been no activity on this account since (you oughta see our Chase card balance...*lol*). If the interest will stay at this rate, please let me know, because we'll need two replacement cards. I shredded the other two so we wouldn't incur the higher rate of interest, per the letter dated December 2008.
You may continue to use your account under the existing terms until the end of your current membership year or until your card(s) expires, whichever is later; at which time the account will be closed.
If you wish to get replacement cards, please reply to this message with all the 16 digit account numbers.
I'm still not clear on this. Say our expiration date is 2012. This means, as long as our account is in good standing, we'll get the lower rate until that year? Because when I originally called to question this, I thought I was told that the next time we used the card, the next statement would reflect the higher rate. But if I was mistaken on this, I'd sure be a happy camper.
The change proposed to your purchase APR was due to a reexamination of our policies was needed given the severe changes in the financial markets. Our costs in borrowing the money we use to lend have gone up significantly. In addition we are seeing dramatically higher loan losses and delinquencies for many of our customers. We must manage to the dramatic changes we are seeing by changing some of our rates and fees in order to continue to provide you with products, benefits and services we have today.
Though these changes are being proposed on your account, you still maintain the right to Opt-Out of them. By doing so you can continue to use your card at the current terms and rate until the expiration date of the current card. At which point the account will close and you can pay down your balance at the same terms/rate.
Our records show your expiration date is set for May 2011.
Okay, so if I opt out, I can still use the card at the lower rate until 2011. But if I don't opt out, my rate will go up. I guess I'll do the opt-out thing and I need to request replacement cards, since I've got two more years at the lower rate (providing we keep the account in good standing). Thank you.
Our records indicate your interest rate increased due to a change in your account terms. You were sent notification of the change in terms in November. If you do not wish to accept the new terms, please reply to this message.
Did anyone hear me screaming? What a bunch of total garbage doublespeak!
I told them to just forget it. And that I was glad they didn’t get their jet.