"This totally threw a wrench into my budget. I can't come up with $500 a month extra for this." Diane has a balance topping $16,000. In the past, she's always paid on time, earning a low interest rate of 2.9%.
She's afraid if she's not able to pay the higher minimum payment her account will go into default, and, according to her contract, the 2.9% rate will jump to 23%. "I feel like they (her credit card company) want me to default. They want me to default so then I'm paying 23%."
"I think they're ripping me off." Brick Township's Patricia Barber is also dealing with a change to her credit card account.
Last month, she was notified her low 6.99% percent fixed credit card interest rate was going to adjust up to a whopping 17.99% in August. What was the reason? "Because they can. Until the law going into effect, they can. That's why they're doing it. They (a credit card customer service representative) admitted that to me."
The new credit card reform bill President Obama signed doesn't take affect until July, 2010. But some credit card companies are making changes before the law goes into effect, and that's bad news for some customers.
"I think that we bailed out the credit card companies and banks so they could not go into bankruptcy," says Patricia. " So they could force me into bankruptcy."
"This is about pure greed." State Senator Robert Menendez (D-New Jersey) is one of the authors of the new law. His take on these credit card changes? "The bottom line is this is an industry that hsould have gotten a wake up call with the law Congress passed and that President Obama signed. And you know if it fails to do it we'll still have continuing legislation going forward."
So what is a consumer to do? First, call the credit card company and fight the change. Patricia did, and cut the rate hike in half. But you'll only be able to do this if you have a history of paying on time, every time, which is another tip. And, if you can, keep your balances low. Many of the consumers we speak to who are getting hit with changes have more than $10,000 balances. And, remember, you can always shop for a better rate.
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Story by: Tappy Phillips
Produced by: Steve Livingstone
To find lowest credit card interest rates:
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STORY BY: Eyewitness News reporter Tappy Phillips
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