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American Express / interest rate increase

1 Tracy, CA, United States Review updated:

Just got a letter from American Express dated 8/4/09 that they are raising my interest rate. Not beause of a change in my credit history. Nor have I ever been late on my payments -NEVER! I always pay more than my minimum balance each month. Effective Oct 1, 2009 - my new interest rate goes into effect- and it applies to EXISTING Balances and future balances. American Express explanation... due to the business and ecnomic environment. I thought that could not punish consumers with interest rate increases unless we were 60 days late. How does the new law that went into effect protect consumers. I am responsible with my credit card. So, I have cancelled my Amercian Express card and will pay the entire balance off. They are not going to take advantage of me!

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  • Se
      24th of Dec, 2008
    0 Votes

    "Stealth" Interest Rate Increase
    Check your last two hard copy AMEX statements for "Important Information about your Account"
    Buried in the fine print on the reverse side of your bill may be a note telling you that as of a certain date your APR on all new charges and previous balances will be increasing. (In my case 30% - from 9.99% to 12.99%)
    When called they will attempt to distract you with a recital of AMEX's supposed benefits rather than give you a reason for the increase. When pressed all they can say is that they're doing this on a "lot of" cards.
    I expressed my outrage clearly, figuring that my excellent credit and routine high (interest generating) balances would lead them to try to retain me as a customer. Guess again. They made no movement to retract their unwarrented so I immediatley cancelled their card after a (until now) good 10 year + relationship. All outstanding balances on this profitable card (for them) will be paid off within 60 days - and at the old rate since I closed the account.
    My question is this ... Is this the kind of idiotic business plan we are now subsidizing with our bailout money. If it is, we are all in big trouble

  • Ab
      18th of Feb, 2009
    +1 Votes

    I agree with you 100%!!! The same exact thing happened to me. My interest rate was FIXED at 7.99% and they increased it to 10.99% without my consent. Isn't it illegal to break a contract without both sides giving permission??? Looks like it's a 3% increase accross the board. I spent a looooong time on the phone with no positive results. I was a valued customer as well and will CERTAINLY be closing my account.

  • To
      12th of Aug, 2009
    +1 Votes

    I just received a letter from American Express dated Aug 4, 2009 stating “to be responsive to the business and economic environment. They have found it necessary to increase rates and fees on some products.” They will increase APR on purchases and cash advances, increase APR on any balances that have a penalty rate because of late payment and increasing late payment. But the good news is that they will not charge an over the limit fee.

    Now this letter does not state I have the right to reject this rate increase.

    All this supposes to take place Oct 1, 2009. Please let me know if a Class Action Lawsuit is filed. I can be reached on Blackberry Messenger at PIN: 30943C25

  • Cl
      13th of Aug, 2009
    0 Votes

    Like others, I received a letter from american express stating my interest rate would be increased as a result of "the business and economic environment". What a bunch of SH**. I contact the consumer line and initially spoke with Monique ID#38662 - she continued to say she had the authority to decrease my interest rate but just wasn't going to do it. Eventually she determined there was another type of card that was a whopping !% lower!!! Yahoo.
    Then I requested a call back from Jody Lattimer, an alleged "Director" in the Denver office. She sounded like a robot and kept saying "no-one, no how" would lower my interest rate in the WHOLE COMPANY...Interesting. She then told me her department supervisor was named Donette Feliciano - again in the Denver Office.
    I think this company is full of greed and manipulation. I sincerely hope that everyone calls them AND WRITES THEM - and uses these individuals' names to make it more of a "personal" matter. Their general number is 1-800-528-4800. It is time that we stand up and say NO. I plan to pay off my balance and close my account. Again, like everyone else - I have never had a late payment and I frequently pay on this card multiple times/month. Again, this is totally bogus and scam like. We need to cancel our cards en mass!!!

  • De
      13th of Aug, 2009
    +1 Votes

    I just received the same letter. I thought I had missed a payment at first. I called them to ask about any late payments. They said I had never made a late payment for the 5 years I had the card. I rarely keep a balance and pay in full most months. I told them not to raise the rates or I would cancel the card. She said she would be glad to close my account. I said I've been a loyal customer to AE and don't appreciate the increase. They get a kick back everytime I swipe the card and their just going to let me walk? This should be illegal. I had an agreement with AE with a specified interest rate. Show me the fine print where it says they can raise my rate at any time. Show me!

  • Ch
      13th of Aug, 2009
    +1 Votes

    I just received the same letter. After some research I discovered the Credit Card Reform Act does not go into effect until Feb 2010. I guess that gives all the credit card companies enough time to stick it to their customers before they can get in trouble for it. Luckily, the other letter in the mail contained a check from my mortgage holder with an escrow overpayment check that will cover 75% of my AE balance. I paid my balance off and told AE what they could do with their card.

  • Ja
      13th of Aug, 2009
    0 Votes

    Same story. 8/4/09 letter. My family charged over $65, 000 on AMEX last year. Usually I pay the balance in full each month. FICO over 790. Never late. 30 year old account. Told them to stuff it and canceled the card for myself, my wife and two young daughters.

    AMEX used to be a Tiffany card, a cut above.., now it's just another sub-prime whore I guess. Credit Unions, here I come!

    Does this business model work in other than the very short term? Warren Buffet, are you listening? Seems like GM also had this same "strategy" of giving up loyal customers and market share--until there were no more customers...

  • Ma
      14th of Aug, 2009
    0 Votes

    I too received the same letter and I have NEVER been late or gone over my limit, nor do I have a high balance...I have not called yet because I know they will just make me angry...I don't understand, do they NOT want out business (WHY)...there are many more cards out there offering better rates...I say to hell with American Express, they are profit hungry and don't care about anything but money. I wish there was a way to take the "American" out of their name because they are not worthy of it!

    First they outsource their work to other countries so they don't have to pay AMERICAN citizens wages..then they turn on their customers with GOOD CREDIT with these rate increases...SHAME ON AM-EX!

  • St
      14th of Aug, 2009
    0 Votes

    They just did the exact same thing to us. We have always had an account in good standing. They started this whole process by lowering our credit limit twice, and then on our gold account they said we can only spend $1000 at any given time. So, I ask them, why do you say that the account has no spending limit? They say, oh, it doesn't have a spending limit, you just can't spend more than $1000.

    Hmmm...that sounds like the very definition of a spending limit.

    In any event, we are sending a letter to Amex CEO, CRO, our state Senator, Congressman, and the President's office. It might not make a difference, but it will at least give them some extra paperwork to do.

  • Sc
      14th of Aug, 2009
    0 Votes

    I received the sam eletter as well. I started looking at previous statements online and found they had increase my rate in January of this year as well from 9.9 to 12.9. now they are again increasing it to 15.24%. It is nice to see how a business treats good customers with excellent credit. I would hate to see how they treat people who don't.

  • Be
      14th of Aug, 2009
    0 Votes

    As we have separate American Express accounts we received 2 letters. One account is changing to Prime +11.99% and the other to Prime +13.99%, which right now yields 15.24% and 17.24% respectively. Our previous rate was a fixed 9.99%, so the increase is 52.5% on the one card and 72.5% on the other card. The only reason that the credit card companies are raising our rates is because of the Credit Card Reform Act that has been passed by the current liberal socialist government in the name of protecting the consumer. I don't see how increasing our rates by 52.5% and 72.5% protects the consumer. The government needs to stay out of the private businesses and let the free market dicate rates, not the government. Be very wary of the things that the goverment is doing in the name of protecting the citizenry!

  • Ja
      14th of Aug, 2009
    0 Votes

    I recieved the same letter dated 8/5/09. I have sent two e-mails with my objections. I enrolled for a card at 7.99% fixed rate. I was told By american express they can change the card holder agreement anytime they want. I suggested to be fair to their customers they should only increase the rates on new purchases or cash advances effective 10-1-09. This way customers would have a choice to decline or accept the change. They said NO. AMERICAN EXPRESS DOES NOT CARE ABOUT THEIR CUSTOMERS...I have e-mailed complaints to Federal Consumer Protection Division and the Better Busness Bureau. I suggest all American Express customers flood them with complaints. Legal action should be taken against them for unfair consumer practices. The consumer is also affected by the economy and the government is not bailing us out as they are big businesses & banks...if I file bankrubptcy I loose my job...

  • Ti
      15th of Aug, 2009
    0 Votes

    I received this letter this week. Same situation as all the comments above; execellent credit, etc. I went up two management levels in their Customer Service center with no satisfaction. The last manager I spoke with said even her card rate was being raised.

    I have filed a complaint with the Attorney General of my state. While this news didn't change their stance, it did seem to irritate the manager with whom I spoke. Not sure that baiting the bear is wise at this point, I don't know what kind of retaliation may result.

  • Li
      15th of Aug, 2009
    +1 Votes

    Dear Mr. Chenault (CEO AMEX),

    I just received "your" letter from "your" company regarding raising the interest rates on my Blue card...and ending with "Thanks for being a card member and "We look forward to serving you"...BALONEY!!! First, let me congratulate you and American Express on joining up with the Low Life, Loan Shark Club of America, a.k.a. the rest of the Financial Industry. The terms outlined in 'your' letter would be to say the least, outrageous under normal circumstances, let alone in the midst of the longest recession since the 1930's. This is proof that American Express does not care how or where it makes a profit, if it means screwing the consumer then, so be it. I have been working diligently to pay down my debt, always more than the minimum and always on time, for what? I will clear my balance at the earliest convenience and will never do business with American Express again. The reason I went to "Blue" in the first place was a "fair" interest rate, not low, "fair", I now see that this was nothing but a bait & switch operation. Hopefully you are reading the same financial news as I am, and if you are you will see that statistics are showing the American consumer quickly turning away from credit cards...great news for me...bad news for you Mr. Chenault. Just remember when this recession is over, all of the good customers that you and your company attempted to screw along the way, because we certainly won't forget! Hopefully one of these fine days I will read about American Express's fall from grace ala Lehman Bros, etc, etc. Also please enjoy your "annual incentive" at your customers expense!

    Thanks for Nothing.

  • Ke
      15th of Aug, 2009
    0 Votes

    I received a notice in the mail from AMEX that said my APR was increasing from 10.24% to 14.5%. I emailed them and expressed my frustration with their decision since I have been a card member for 10 years. The assured me that I was a valued customer but they were raising my rates anyway. How can they call anyone a valued customer while they are raising their rates? That is just stupid. Anyway, the problem I have is when I asked if my interest rate would not change if I closed the account. They said there was nothing I could do and if I closed the account the new rate would still be assessed against my account. I was floored by this because other cards have allowed me to close the account to keep the current interest rate it had. I thought it was one of my rights as a cardholder. I agreed to a certain APR when I opened the account so how can they change it and I have no recourse? I'm filing a complaint with the Federal Reserve and the FTC because this seems criminal to me. I should be allowed to close the account and keep my current rate. AMEX isn't the only one doing these rate increases, other credit card companies are doing it also--I've just been closing the accounts because I don't want to do business with anyone that treats a good customer that way. I told AMEX that if I was such a valued customer they would be lowering my rates during these difficult economic times, not raising them, especially on a loyal customer of 10 years. These credit card companies are shooting themselves in the foot because I believe many people will cease doing business with them and that could prove devastating to their business.

  • Co
      17th of Aug, 2009
    0 Votes

    I work in this industry and was therefore shocked to receive the same letter. I have a very good credit history and credit score - upon calling I was told by a supervisor that what AMEX is doing is completely legal. Under normal conditions one is allowed to close a credit card account freezing the terms of the card at the time of closure (thus keeping my rate where it is currently). However, I was advised that there is no opt-out on the rate increase and thus, any remaining balance after 10/1 would be at the new rate- a 60% increase in my existing rate.

    Luckily my balance was small enough that I was able to liquidate some other assets and pay the card off in full. It appears that AMEX is looking to rid itself of revolving balance accounts (in this case the Blue card).

    This is fine, they will lose my business as well as anyone else I can spread the word to. I was urged to "write a letter" to the Amex service team, I wouldn't waste another the money on the stamp. Good luck card holders- things will probably continue to get worse for some time.

  • Bu
      18th of Aug, 2009
    0 Votes

    Same thing happened to me just this week. Over a period of years, they've increased my credit limit to $22, 000, which I never asked for. This $$ figure is absurd to begin with but certainly helps the credit ratio and makes my credit score look pretty decent...until they decided last month, without warning, any missed payments, any specific reason other than 'we're a financial institution, and we're sorry but over the past couple of decades have been making poor business decisions...in turn, we're choosing to screw you without warning to try to fix the mistakes we've made'.

    So, I get to take this one up the pooper thanks to their choice to raise, and then without any rational data regarding me and the way I handle my credit, lower my credit limit. Adding insult to injury they've decided to jack around with my APR on Oct 01 as well. What a crappy business partner, once my balance is paid off, I will not be going back.

  • Ja
      19th of Aug, 2009
    0 Votes

    Same happened here. Amex is not the brand they once were.

  • Ma
      19th of Aug, 2009
    0 Votes

    Same thing here! Jill at AMEX gave me the same garbage. I asked about the new law that passed to protect consumers - allowing us to call, close our accounts and freeze our lower interest rates until the balance is paid in full. Nope - That does not work for any of us who received this rate increase letter DATED before the law takes effect. Lucky us! How is it legal to sneak all these letters in - RIGHT BEFORE the law requires some of the new previsions to begin - TOMORROW, AUGUST 20th, 2009!! How convenient. And Jill's response, this is the timeframe in which AMEX usually reassesses everyone's rates. She was nice enough to tell me how much $$ my minimum payment will be on 10.01.09. Great... that's $$ I can't put back into the economy now. THANKS AMEX!!

    And I have another question for everyone leaving a complaint... does your letter state "Like all companies large & small, our pricing has to be responsive to the business and economic environment. As a result, we have found it necessary to increase rates and fees on SOME of our products." ~~SOME PRODUCTS??? ~~ Mine is a Costco Rebate card. I'm curious to know how many & what type of 'products' have been increased... Does this affect ALL AMEX card holders?

  • An
      19th of Aug, 2009
    0 Votes

    We have (make that HAD) a personal AMEX (since 1974), a business AMEX (for 8years) and were accepting AMEX via our merchant status (for the past 4 years). On 8/18, we received a letter from AMEX dated 8/11 advising us they were exercising their right under their merchant agreement to begin 'holding' funds due to us in 'reserve' under some b.s. they called a 'business decision'. Lo and behold they also cancelled both our personal and business cards this week which have NEVER had a late payment, NEVER been over the credit limit, and RARELY have a carryover balance. We have excellent credit. We were told we were 'costing' them money because we pay in full. Needless to say, we have cancelled our merchant status with AMEX (but will accept cards that 'seem' to appreciate our business) and are thoroughly disgusted with what used to be a small business, customer friendly company. The are now lower than the stuff slugs excreet. AND...took our 124, 918 award points advising because the card was closed, the points were no longer valid. HEY YOU AHs -- YOU closed the card without warning for no sensible ethical decision. Well, know what ? What goes around, comes around and I hope you get yours SOON.

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