I took advantage of some balance transfers to move some home equity line of credit debt onto several Chase credit cards, locked in at 3-5% until the balance is paid off. Of course, if I miss one payment, up goes the rate. Now Chase is telling me that they are going to raise the monthly minimum payment from 2% to 5%. I told them good luck with that. I will see a lawyer to find out my options, because that huge an increase will be impossible for me unless I stop eating.

I wonder about the legality, too. Surely if they can't raise the interest rate because of the initial agreement (which I have long since lost), there must be some restriction on increasing the monthly minimum. Making it 100% would be plainly outrageous -- I can't see how any court could approve that, regardless of what any agreement said. So one of the things I will do when I meet the lawyer is ask about that.

Chase's motive is obvious -- not just to get in ahead of the law, but to force me to miss a payment and giving them the excuse they need to jack up the rate. But long term, I don't understand. I have been making payments faithfully for 5 years. Even at a lowly 2%, they will be paid off within 5-6 years. Why do something almost guaranteed to lose them money long term? I mean ... if they actually do raise that minimum, then raise the rates, eventually my only recourse would be bankruptcy.

It is also an "of course" that they haven't responded to the email I sent them via their website. I expect no less from their robots.

I have a some wonderful beach front property to sell you in Arizona. Marvelous veiws of the Pacific right from your front porch.

Seriously, you are surprised that Citigroup is jacking up rates as much as possible before the rules change?

You've been covering business matters for how long?

Thank's to Andrew's summary of a report he saw, we all know now that banks don't think of their customers' best interests first. Say it ain't so, Andy.

What's next for this intrepid business column? Perhaps a hard-hitting expose on the fact that fast food isn't healthy; that in fact McCrappyBurger and such are killing their customers with salt, fat, corn syrup, and saturated fat? Maybe you could just cut and past 200 words from Schlosser and call that a story.

>The rate increases fell mostly on borrowers who failed to pay off their monthly balance in full. Let that be a lesson to us all.

How does this justify the rate increase. So because someone utilizes their credit card for CREDIT they deserve to pay loan shark rates??? I pay mine in full almost religiously but because my income is hinged on my customers, sometimes I have to float. Should I now start paying 30% interest, even for a few months for the privilege??? Am I now a horrible credit risk? BS.

Having done some peer to peer lending on Prosper, I have become much more sympathetic to credit card companies. 15%-30% may seem outrageous, but you'd be outraged at the number of defaults. From my experience the interest (between 7%-25%) does not even begin to pay for the defaults. There are alot of deadbeats. And you know what the people who don't pay their bills in full are the ones who more likely to not pay at all some day... Risk/Reward.

In the world of credit, everyone pays for the sins of the few.

15%-30% may seem outrageous, but you'd be outraged at the number of defaults.

Defaults are what you get for lending money to people who can't afford it in the effort to increase your herd of debt slaves. Defaults are your way to "justify" raping everybody else.

In the world of credit, everyone pays for the sins of the few.

Sin is evidently basic management strategy.

Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.

John Maynard Keynes

My Chase card has gone from 8% to 14% since January and was just upped to 21% for no reason at all. I called to request a decrease and got a flat-out "no" with a suggestion to call back in 6-12 months. I closed my credit account and will be closing my Chase (formerly WaMu) checking account as soon as HR updates my direct deposit information. I'll probably take a hit on my credit report for closing the account but I don't even care anymore.

My Citi card is holding at 6% but sounds like I should check again next month.

I see it as hilarious. Citi has just jacked a round into the chamber and has its foot squarely in the crosshairs. The article didn't say that it was raising the rates on its cards but on the store cards it co-brands. Now, if you were the finance manager at Sears, JC Penny, etc, what would you think of your bank partner doing things with the credit card that would likely have a dampening effect on sales -- in this economic environment? If I were the manager, I'd be trying to find a new bank to issue my credit cards.

It might be that by spreading the pain beyond those who pay late and/or carry a high balance that we will see an overall reduction in credit demand.

walter_map knows his beans when it comes to debt. It IS a form of slavery, as these poor souls who complain about the shifting terms of their debt vividly demonstate.

I guess we should go back to the good old days when banks would happily loan money to anyone, as long as they did not need it. Down payments on homes should be ~25%+ at a minimum. Autos should require the same or more.

Americans have now comprehensively proved they are not sufficiently educated to understand the loan documents they sign. These banks are taking advantage of children, in terms of financial sophistication.