In The Past Six Months, All Of The Top Eight Credit Card Companies Have Applied Increased Interest Rates On Existing Cardholder Balances
Came across this recent report and it seems to re-affirm what you may be hearing on TV and Radio about even customers in good standing experiencing rate play from their credit card companies.
We took a quick sampling of credit card issuers’ recent activities to see how they have responded to the Federal Reserve rule changes that were announced in December 2008 but won’t take effect until July 2010. We found the top eight issuers, who account for 80 percent of credit card balances, are raising interest rates on a larger portion of customers than usual and increasing the number of fees they impose. The new Fed rule will ban some but not all of these activities.
Perhaps most notable is what these issuers — Citigroup, Bank of America, JP Morgan Chase, Capital One, HSBC, Discover, American Express, and Wells Fargo — have not done. All continue to apply a customer’s monthly payments to the least costly balance first, leaving the most expensive to continue to grow. None have changed their policy of imposing interest rate hikes for any reason, any time. Additionally, there is no evidence that any of these companies has expanded the period of time between when monthly bills are sent and when late fees apply.
Many folks look into balance transfer cards for the above-bolded reason. To avoid a high interest rate on one card, a more competitive one is used to get the cardholder in a better position for repayment. But if that card is also subject to unannounced increases in rates, a consumer is left wondering what they can possibly do to get ahead of the curve. Especially when seven of the top eight issuers increased their penalty APRs. Many families are finding themselves stuck between a financial rock and a hard place.

