I have got quite a bit of balance outstanding on MBNA cards (Virgin, A&L and Abbey - about 30k!).
I was talking to the representative yesterday and I was shocked to hear that the 0% balance rate has gone to 34%!!!
It seems once the balance transfer was done, they moved to 16%, then to 26% and then to 34%.
Due to financial situation I am at the moment, I am struggling to pay the actual amount - on top of this the interest rate hike is really eating my payments.
I asked them if I can get any reduced rate they said no. They said "I can complain, but I can't do anything as FSA knows what they are doing"
I am stupid to think that the rate was going to be at around 12%. But this 34% rate is really really terrible. They said I have been notified by post!
Is there any thing I can do to reduce the rate such as complain? or take to some bureau? etc.
Any advice is HIGHLY appreciated.
Thanks
M
They can increase the APR to whatever they like - its what a variable APR means. You could ask them to reduce it and if they don't lodge a formal complaint saying you have an excellent credit record (if this is the case) and have never missed a payment. If that fails, your only option is to accept the increased APR or to transfer the debt to a 0% card.
Can't you balance transfer to another 0% rate?
All these people getting their charges and fees back is causing this. I'm sure the other institutions will follow suit...
There's a few news headlines going around about this - basically the government aren't happy with the cc companies and they've been having meetings to try and get the cc companies to act better (http://www.credit-card-comparison-online.co.uk/news/credit-card-news/5-December-2008.html).
There have also been cases of people getting their interest rates put back down again because the cc companies can't provide a reasonable explanation of why they put them up so much (http://www.credit-card-comparison-online.co.uk/news/credit-card-customers-fight-interest-charges.html)
Hope this helps
Can't you balance transfer to another 0% rate?
I don't have any at the moment. I am looking at the possibility of lodging a complain
There's a few news headlines going around about this - basically the government aren't happy with the cc companies and they've been having meetings to try and get the cc companies to act better (http://www.credit-card-comparison-online.co.uk/news/credit-card-news/5-December-2008.html).
....
That's a great news - thanks.
Is there a proper way to make a complain to Financial Ombudsman?
Don't know who you've been speaking to already, but give their customer loyalty department a ring on 0800 783 1116 (during office hours).
It's a variable rate credit agreement thus there is nothing to complain about (although I appreciate the rate is high in comparision to other lenders).
Yes I understand it's a variable rate agreement. Does it mean that they could take my rate to 40% or 50% or even more. It doesn't sound sensible to me.
A piece of legislation, or some one who had had earlier experience or some kind of formal complaint might help me.
Yes I understand it's a variable rate agreement. Does it mean that they could take my rate to 40% or 50% or even more. It doesn't sound sensible to me.
A piece of legislation, or some one who had had earlier experience or some kind of formal complaint might help me.
In theory, yes they could hike the rate to 50% or so in line with the T&Cs, however I would hope the OFT would step in if this happened without excellent reason.
BTW, MBNA are very well known for increasing the APR after a promotional period has ended, especially if the customer has a large outstanding balance.
It's one way of the main ways the company makes money, as they know some people cannot shift the balance away.
Unfortunately, it seems you have fallen into this trap. It may be worth reading Martin's stoozing article as this reiterates the importance of moving balances before a promotional period ends.
I think you should concentrate your efforts on trying to move some or all of the balance away, as this would probably be the quickest and easiest method to stop paying this APR.
I am taking this balance at a high alert state - and making all the possible avenues to clear this off.
One interesting fact is that everytime I call the bank, the advisor *ALWAYS* advises me to take a loan from loans.co.uk company. Can they do so?
I called them up to seek the interest rate hike history (the dates on which they have increased my rate). Here are the details.
Abbey:
As of today: 29.9 (Balance Transfer and Purchases) & 34.9 (Cash Advances)
28 July 2008 21.9 & 27.9
28 Jan 2008 18.9 & 21.9
29 Jan 07 9.9 and 9.9
Virgin
As of today34.9 & 34.9
27 May 2008 27.9 & 27.9
26 Sept 2007 24.9 & 24.9
29 March 2007 15.9 and 20.9
A&L:
As of Today 34.9 & 34.9
29 May 2008 27.9
30 July 2007 16.9 and 22.9
In some cases (Abbey), they have increased three times in the same (2008) year!!!
Exactly the same thing happened to me, with a 10k balance on the MBNA card; I complained but got nowhere. When I did the debt snowball I was in tears (had another 15k of debt on other cards which had also started to creep up but not as fast the MBNA rate!) and had horrible sleepless nights as it was going to take decades to pay off.
What I found was that the widely advocated 'credit card shuffle' simply doesn't work in this situation.... there is no way that you can get another balance transfer for a single card for that amount...most cards do two or three thousand max opening balances, and that is if your credit score is good (three credit searches within 6 months will wreck your credit score though)...(naturally, the credit card companies are well aware of this, even if the well-meaning majority of MSE isn't).
Sorry to be a bit pessimistic...
The silver lining was that it scared me so much I consolidated all my debt into a short, sharp shock loan which I will pay off in two years with 5.9% interest, and am now paying off the last drips and drabs of my cards and gradually shutting them down completely. I am NEVER going to have another credit card...
Exactly the same thing happened to me, with a 10k balance on the MBNA card; I complained but got nowhere. When I did the debt snowball I was in tears (had another 15k of debt on other cards which had also started to creep up but not as fast the MBNA rate!) and had horrible sleepless nights as it was going to take decades to pay off.
What I found was that the widely advocated 'credit card shuffle' simply doesn't work in this situation.... there is no way that you can get another balance transfer for a single card for that amount...most cards do two or three thousand max opening balances, and that is if your credit score is good (three credit searches within 6 months will wreck your credit score though)...(naturally, the credit card (http://www.mint.co.uk/credit-cards.asp) companies are well aware of this, even if the well-meaning majority of MSE isn't).
Sorry to be a bit pessimistic...
The silver lining was that it scared me so much I consolidated all my debt into a short, sharp shock loan which I will pay off in two years with 5.9% interest, and am now paying off the last drips and drabs of my cards and gradually shutting them down completely. I am NEVER going to have another credit card...
Glad your on the right track now :)
Credit is always a gamble at the end of the day
I suggest that if you are struggling please go over to the debt be wanna be bored and get some help from the guys and gals over there.
Quite scary that until seeing 34% and thinking wow that sounds high, and then looking into what it actually meant via all the tools and helpful advice on this site, I had no idea about the effect of the interest rates on how long it would take to pay back....:o
Never again!
I wrote a compain to MBNA - as debtdesperado said, I am not to optimistic - but atleast I will fight.
I also spoke to Ombudsman - they are sending a request to MBNA for in-depth investigtion on my accounts.
I am on my second job now :)
Can the same thing to be done by mortgage comapnies? No, right - although some deals are variable deals. Then why can't the same to be applied here in this situation?
If you are on the lenders standard variable rate then you could potentially see the same issue as there is nothing to stop them increasing it.
Poker_FaceCredit is always a gamble at the end of the day
No credit card is not always a gamble. It is debt to be managed effectively or be prepared to pay for mismanaging.
MBNA have effectively been cornering the market for some time, they are in the money lending business they are not a charity. Once they felt that there were no further options to transfer debt then it was obvious that they would screw the rate up.
BB
Don't know who you've been speaking to already, but give their customer loyalty department a ring on 0800 783 1116 (during office hours).What did they say?
I also had this problem with an MBNA A&L card. It started as a 17% card followed by lots of 0% offers until before I knew it I was at my credit limit with a debt of 7K and MBNA then raised the APR to 30%.
Following advice from the lovely people on this board I phoned A&L, asking that as I had no missed or late payments why was the rate so high and could they reduce it. They said they could and reduced it to 23%, slightly better.
The not so good news is that a few months later for no apparent reason they upped it back to 30% again!
It does seem crazy that when the bank base rate is at 2% they are allowed to change the APR to 30% when nothing else has changed in the account. To me it's behaving like a loan shark.
Sorry I can't be more helpful OP. I will try complaining just to be sure the relevant authorities are aware of the issues, it might help, however TBH as the contract says variable interest rate I'm not sure anything can be done.
For me I'm able to take on another job to reduce this debt. Also I'll transfer as much as I can to other cards I have over time.
Hope you get somewhere with this.
What did they say?
They said - "Sorry we can't do anything"
I just don't understand MBNA,I have both an A&L card and a Virgin one.They both keep increasing my credit limit(6k & 9k) which I never use for more than a couple of hundred pounds at a time.In the past couple of weeks not only has my limit been upped but my A&L card has had the interest dropped to just over 15% and I have been given 0% interest on purchases till June next year.I was also sent 7.9% life of balance cheques for Virgin.What are they playing at.
They are trying to get you to spend on your card. Pretty obvious isn't it?
Can MBNA increase the Interest rate to ridiculous 34%?
Yes they can, it's a variable rate and decided by your risk profile (in part).
I heard of many similar cases. In many cases the customer has never missed a payment and generally deemed to be a good risk, hence the increase in credit limits and 0% promotions etc.
The problem is that the so called "variable" rate is determined individually for each customer AND the rate is decided subjectively, entirely by the banks (they say it's determined by the "risk" assessed - yeah, right)
IMHO, all these dubious practices employed by the banks should be deemed as unfair and will eventually be challenged by consumer groups and WILL stop - eventually.
In the meantime banks will try to rake in as much profits as possible out of the misery of decent, honest, albeit vulnerable, people, while they still can.
This is no different from mis-sold policies, endowments, unfair charges, extended warranties etc and many many other practices that at the time were the norm and looked reasonable and proper.
The truth is that banks are literally encouraging (pushing) people to fall into a debt trap, with no way out. This is no different from encouraging gambling and even drug pushing.
you may think my point of view is radical, but when you come to know how cold and calculating some of the banks' strategies are, you will be truly appalled.
but when you come to know how cold and calculating some of the banks' strategies are, you will be truly appalled.
I don't know why you're building it up to be this uncovered thing. Banks exist to make money, not as a public service. The sooner people realise this then the sooner they can play them at their own game!
I don't know why you're building it up to be this uncovered thing. Banks exist to make money, not as a public service. The sooner people realise this then the sooner they can play them at their own game!
When billions of pounds of tax payers money has been put in place to prop up the banking industry I think you'll find the playing field has changed.
Back to topic - If you don't accept the interest rate can't you have the account closed pending full payment at the old interest rate ???
MBNA have written to me. My interest rate has gone up to 34.9% on a Leeds United account which has been closed pending payment because of MBNA and the affinity group no longer deal with each other.
Before you all start saying my credit rating is bad - Halifax have increased my credit limit by a 1000 last week.
Trouble is I can't transfer the balance because technically the account has been closed pending payment.
I don't know why you're building it up to be this uncovered thing. Banks exist to make money, not as a public service. The sooner people realise this then the sooner they can play them at their own game!
So are Casinos.
You're missing the point here, banks are preying on the most vulnerable of clients who are also deemed profitable to them. These are usually honest, hard working people who will do anything to keep up payments etc. - unlike the ones identified as purely "bad risks".
The tragedy is that Bnaks actively identify these "profitable borrowers" and then even more actively apply clever strategies to make them fall into the debt trap.
If enough people take action, consumer groups and the Governemnt will take action. The sad thing is that in this country everything is done "after the event", when often its too late for many.
If you don't accept the interest rate can't you have the account closed pending full payment at the old interest rate ???Yes, but that option is only generally available to customers who settle the account within a reasonable timeframe (60 days rings a bell).
If enough people take action, consumer groups and the Governemnt will take action. The sad thing is that in this country everything is done "after the event", when often its too late for many.
This is what I am looking seriously - not that I can start a revolution but awareness.
I am sure there are lots who are genuinely falling into this trap by those greedy banks.
I am concentrating on raising an online petition to the govt as a first step. Any suggestions?
Please suggest me any more ways I can (with your help) raise/fight.
Yes, but that option is only generally available to customers who settle the account within a reasonable timeframe (60 days rings a bell).
Sorry your missing the point of my question. I'm sure with Capital One that if they increased the interest rate they gave you the option of having your account frozen at the old rate, but you obviously couldn't continue to use the card for credit, until it was finally settled.
Sorry your missing the point of my question. I understood your point perfectly.
Egg used to operate as I said earlier. You could remain on the old rate for a limited time only if you informed them in writing of your intention to settle within the requisite number of days (60 from memory?).
They now say, simply, "...this Agreement will continue until you have repaid all amounts you owe us", inferring the new rates apply until settled.
You are correct (do a degree) on Capital One. The specific text is as follows...19. Variation
If we increase any interest rate or the margin over Base Rate, we may permit you to pay off the outstanding balance at the interest rate which applied before the increase takes affect. You will have to pay at least the monthly payment each month. ...which seems to say it's not so much a done deal; more at their discretion and based, presumably, on personal circumstances/debt charity involvement/etc?
Suggest your main problem is the level of debt as much as your interest rate. Sounds like you need an Individual Voluntary Arrangement whereby you & your creditors agree to pay off a percentage of what you owe, meantime the debt is frozen.
I am not in any way qualified to advise, but free professional advice is available here:
http://www.cccs.co.uk/
Do NOT, under any circumstances, get involved with the many companies that offer to negotiate IVAs on your behalf.
I have conacted Sion Simon MP with the above details expectng him to work with Govt and FO.
Read his message regarding the same here: http://www.sionsimonmp.org/2008/11/credit-card-lenders-must-stop-unfair-interest-rates-hike/
Thanks
Madhusudhan
And to Bob Laxton - MP Derby
And to Davind Hanson,MP Delyn
At a time when families are really struggling through this downturn
So people have just accrued 10-12K of debt in the last few weeks/months have they?
I would suggest not.
The days of endless stoozing are clearly coming to an end and the CC companies want some payback.
There are still ways to play the game but you have to accept, whichever way you approach it, that you are borrowing money and that comes with a cost. If you have no quick escape route then it might be very expensive.
BB
MBNA are loan sharks. They encourage paople into as much debt as possible, then turn on the screws.
MBNA business plan - to try and make as many people insolvent as they can before the years out.
I can't understand why people recommend them (this site included).
Just an observation for the MBNA bashers...
cant say i can fault them myself... I have had 2 Virgin cards over the last few years... the most recent of which was opened this year at given a reasonably modest limit of £5500 and after my promotional rate of 0% ended i moved to 14.99% (roughly from calc'ing up from Monthly rate).
I notice from your history of rates that Virgin have always given you a comparably high rate from quite early on (unless they are just the very most recent changes?) There is obviously something about the profile they have built on you which triggers a higher rate, its not a lottery.
There is obviously something about the profile they have built on you which triggers a higher rate, its not a lottery.
The only reason I can think of that I was close to the limits!
All,
I am in a process of setting a blog column -http://unfaircards.blogspot.com (http://unfaircards.blogspot.com/)
I wish to create an awareness about this issue.
These are the activities I have followed up till now:
- I have complained to MBNA
- I have asked Financial Ombudsman to investigate
- I have started writing to MPs and
- I will apply for an online-petition.
- Started a poll on the blog site to collect information
The reason for the blog is to carry this awareness amongst people like me. Obviously I can't carry such campaign on MSE.
I wish to prepare the notes on my day to day progress on this issue.
I must say you all MSEs are my beacons - my inspirators. I sincerely invite here or on the blog to participate.
I am not sure if I can stick the posts here from that blog, or vice versa. I would be happy if some one let me know if I am crossing my lines (have a strange feeling I am !)
M
The only reason I can think of that I was close to the limits!A second being you were only making minimum payments?
And a third being the sheer level of indebtedness you had with their organisation (30K)?
And a fourth being the data they sourced/were fed monthly from the CRA's showing your other commitments (which doesn't show up as a search on your file)?
A second being you were only making minimum payments?
And a third being the sheer level of indebtedness you had with their organisation (30K)?
And a fourth being the data they sourced/were fed monthly from the CRA's showing your other commitments (which doesn't show up as a search on your file)?
- I was paying 500, 400, 300 respectively (well above my minimum payments)
- Ofcourse, third point duly noted
One intersting fact (and others have already pointed) is that they keep on increasing the credit limits (to draw you into a debt trap) even before I ask!
I have an MBNA card which is a clone of Alliance and Leicester - yes they give you high limits but they don't spend any money on these cards and will reduce the limits if you ask.
I got my limit reduced from 14k to 5k.
All,
I am in a process of setting a blog column....snip
Someone else did this about a month ago, you realise your 'blog' is carrying adverts for MBNA?! :p
Thanks for pointing me Jamalfatty - I have removed them. However, as you can imagine, I may have to run the site with ads - well, every little helps for paying my debt.
Hiya, they did this to me as well, increased my limit from 4k, to 6k, then to 8k then to 10k at each stage offering me 0% deals for a few months and then bang 34%. Im ashamed to say i filled the card up and then had to sell loads of stuff to get it down to 8k and then managed to get a loan unsecured to pay it off but they wouldnt budge on the 34% and kept saying it was cos my credit history showed i had gone over my overdraft on my current account which is a whole other story
The same people post the same opinions (me included) each time this thread appears.
They did the same to me, I was in a position to do something about it. Now I know what to do to get myself the hook, I have no qualms about dealing with MBNA. I know what will happen and I plan for it.
In the case of people increasing rates to 34.9% it could be any combination or single reason. I don't know and looking on here, there seems to be no sure reason why!!
Be aware of the risks, and enjoy the upsides.
I'm not sure why you are bothering with this, when the goverment already know and are trying to get Mandy to deal with them, not that I think they will budge that much!
The great credit card scandal
http://www.independent.co.uk/money/loans-credit/the-great-credit-card-scandal-1058003.html
Labour have a bit of explaining to do themselves when it comes to over charging on CC's, as they have one themselves!!!:rolleyes:
Labour is 'hypocritical' on credit card interest
http://www.telegraph.co.uk/finance/personalfinance/borrowing/creditcards/3688209/Labour-is-hypocritical-on-credit-card-interest.html
A sigh of relief !
I spoke to the MBNA Account Review department (after talking to Loyalty and others) to consider my request to reduce the interest rates.
As I told them that I am struggling to pay due to the hiked rates, they have reverted back to my earlier rate six months back - so Abbey now on 21.9 while others on 24.9 (something is better than nothing).
It seems if we let them know (only the account review dept can do this) that we are struggling to meet up payments due to the increased rates, they would go to the earlier rates (and the request should be within six months)
Thanks to all
M
I spoke to the MBNA Account Review department (after talking to Loyalty and others) to consider my request to reduce the interest rates.
Which number is it to get through to this department?
A sigh of relief !
I spoke to the MBNA Account Review department (after talking to Loyalty and others) to consider my request to reduce the interest rates.
M
Do you please have the number for this department? My husband has tried several departments with no success. His interest rate has increased from 16.9% to 34.9 % despite no change in his circumstances and never missing a payment.
I'm not sure why you are bothering with this, when the goverment already know and are trying to get Mandy to deal with them, not that I think they will budge that much!
The great credit card scandal
http://www.independent.co.uk/money/loans-credit/the-great-credit-card-scandal-1058003.html
Labour have a bit of explaining to do themselves when it comes to over charging on CC's, as they have one themselves!!!:rolleyes:
Labour is 'hypocritical' on credit card interest
http://www.telegraph.co.uk/finance/personalfinance/borrowing/creditcards/3688209/Labour-is-hypocritical-on-credit-card-interest.html
Government knows a lot of things that needs fixing. If public is behind a cause, I am sure that escalates the issue which might increase the priority of the issue.
I have got quite a bit of balance outstanding on MBNA cards (Virgin, A&L and Abbey - about 30k!).
I was talking to the representative yesterday and I was shocked to hear that the 0% balance rate has gone to 34%!!!
It seems once the balance transfer was done, they moved to 16%, then to 26% and then to 34%.
Due to financial situation I am at the moment, I am struggling to pay the actual amount - on top of this the interest rate hike is really eating my payments.
I asked them if I can get any reduced rate they said no. They said "I can complain, but I can't do anything as FSA knows what they are doing"
I am stupid to think that the rate was going to be at around 12%. But this 34% rate is really really terrible. They said I have been notified by post!
Is there any thing I can do to reduce the rate such as complain? or take to some bureau? etc.
Any advice is HIGHLY appreciated.
Thanks
M
They tried pulling the same stunt on me too (as well as many others). Fortunately, I have a lot of unused credit on other cards and made appropriate balance transfers. I now have three life of balance deals running simultaneously and the highest is 7.9%. The four MBNA cards that I have all now have balances of 0.00 . It took an extra month to pay off the residual interest but my last four bills from any MBNA derived accounts were c.28, c.9, c.5, and 0.15 (cost them more to send than one than what they got back). I didn't plan to do so much business with MBNA but they bought up other card companies with whom I had accounts.
I've been lucky on this one as I did consider trying to improve my credit score by closing the other accounts. As things have turned out, NOT closing them has achieved this. I also pay those other accounts by DD to ensure that I don't forget a payment. I would give up most of my "spare" credit facilities but there is always the possibility of a very big repair bill on my work van. I absolutely need that to run as my entire income depends on it.
Although they caught a lot of people out, as far as my own situation goes they have shot themselves in the foot. Would I do business with MBNA again? Too right I would - but only at a reasonable LOB deal (which they don't seem to offer) or if they were to offer 0% or very low interest deals. If they offer any more of that to me, I would transfer ONLY the amount that I reckon I could afford to repay during the promotion. I suppose that the next step for them is to reduce my limits and to introduce an admin fee for dormant accounts.
As an addition to the above, I've just checked out MBNA's site. The only rate they mention that is above 30% is their American Express card. All the others are around the 15 - 17% mark. They seem to get around this by calling it the "typical" rate.
A good start would be to force such companies to give equal prominence to the rates that they ACTUALLY charge many of their customers.
While I was doing a bit of research on the unfair credit card hikes, I found an US Senate Bipartisan Investiation report into unfair credit card practices.
The report details eight cusomer cases of unfair credit card interest rate hikes. The report includes a history of payments for each of these eight customers.
It explains that hiked rates are in effect allow the payments to coverup the interest payments while the pricipal balance does not deplete considerably.
Here's the Investigation Report (http://www.consumer-action.org/downloads/english/Senate_CC_exhibit.pdf)
I would appreciate if anyone one who's fallen into this trap like me can prepare their case to post here (http://unfaircards.blogspot.com) (http://unfaircards.blogspot.com)
Hello madhusudhan Found your topics Interesting as i`ve had dealings with MBNA in the past here is a rather American view of the whole credit card culture thingy.
http://www.affil.org/ybf
this is a cleaned up version and they didnt say "fooled" :) in the video i saw.
Hope you find their campaign interesting about getting a fair deal for young people in particular.
Regards M
Which number is it to get through to this department?
Account Review Dept: 0800 028 9170
Customer Loyalty: 0800 783 1116
Loyalty team didn't help me much!
MBNA are one of the most despicable companies in the modern capitalist world we live in
They hiked my rate from 16 to 31 per cent a few months ago
Now they keep sending me credit card cheques and sent me a letter yesterday saying as i was one of their valued customers they have increased my credit limit!!
Like vultures end of:mad:
I have been thinking - can we bring the main companies such as Virgin, A&L and Abbey into account for what MBNA's unfair and irresponsible acts? I am sure those companies wouldn't like their brand names spoiled due to their credit card backstreet business partner.
I was not aware (I am fool, I admit) that all these cards were operated by MBNA until after a year or so!
My wife groans bitterly when ever she hears the company names such as Abbey and Virgin (including TV ads). This made me think that the name of the company may be spoiled.
Any ideas?
- I was paying 500, 400, 300 respectively (well above my minimum payments)
- Ofcourse, third point duly noted
One intersting fact (and others have already pointed) is that they keep on increasing the credit limits (to draw you into a debt trap) even before I ask!
Just because they raise the limit it doesn't mean you have to rush out and spend up to it.
MBNA might not be a very nice company, but they're not in business to be nice and if you repeatedly keep sticking your head back between the jaws of the lion then it isn't entirely the lion's fault when it eventually closes its mouth and bites you.
Yes, it is my failing to use the facility and drown in the debt - no question of denial there. However, I didn't expect that they have a strategy to act/react to customers like me. I have learned my lesson albeit hard way!
It's not just A&L/MBNA that are at it though, Natwest are just as bad, my hubby's A&L interest rate is now up to 30% so we are overpaying that to get it paid off, transferred so much of it to an Egg card on 0% for 15 months and there is just over 2k left to pay now and then its finished with, however in the meantime, we got his Natwest card statement yesterday, this has a balance of 8.5k on it owing and each month the min payment is around 190, it always says the interest will be approx 120 if min payment arrives on time, it always does as we pay by DD.
I have checked this months statement though and the interest was 160 (not 120 like it said last month) we have had no letters saying the interest has gone up or anything and we phoned to query it, they first asked if we had paid on time which we did and then they just muttered some crap about t&c's and they'll send us a leaflet out. How on earth can they justify 160 interest after a payment of 190, so we have only paid 30 off the balance?
We are trying to pay off our debts and doing well but we can't overpay everything at once and if they all start doing this we are never going to get anywhere, don't they realise this?
To those that keep suggesting it is entirely madhusudhans fault for using his available credit, i think you are missing his point slightly. I believe his point is the way you are enticed to use this limit by suggesting its CHEAP credit, eg offering a higher limit in conjunction to balance transfer deal. This gets prudent customers to transfer a balance thinking they are saving money, as suggested in this thread:
http://forums.moneysavingexpert.com/showthread.html?t=33
However, when the low rate ends, you find your dept to at a considerably higher rate than expected, and if you canceled your old cards in an attempt to improve your credit rating you are stuck, and in debt at a much higher interest rate than if you had left your debt on your old card(s).
Thanks for pointing me Jamalfatty .
All
The petition to PM submitted few days back has been approved.
I posted a new thread here. (http://forums.moneysavingexpert.com/showthread.html?t=1362031)
I would sincerely request you all to sign the petition as it may strengthen our case.
Thanks to one and all
Madhusudhan
MBNA are one of the most despicable companies in the modern capitalist world we live in
They hiked my rate from 16 to 31 per cent a few months ago
Now they keep sending me credit card cheques and sent me a letter yesterday saying as i was one of their valued customers they have increased my credit limit!!
Like vultures end of:mad:
Then shred the cheques and don't use the increased limit
Then shred the cheques and don't use the increased limit
dzug1, not everyone wish to go grab money from credit cards UNLESS there's a need and sometimes urgency. At some point when you are looking for money for an unexpected expense, you may find those cheques/cards handy.
It's a game they play - prey being the money.
As an addition to the above, I've just checked out MBNA's site. The only rate they mention that is above 30% is their American Express card. All the others are around the 15 - 17% mark. They seem to get around this by calling it the "typical" rate.
A good start would be to force such companies to give equal prominence to the rates that they ACTUALLY charge many of their customers.
Surprised that someone didnt pick up on this......
Errrrr they do... The new law has applied from 2004 (ish) with some of the key points on advertising APRs being
"All adverts offering credit must show a typical APR and this figure should be more prominent than any other financial information in the advert. In the case of on-line adverts the APR must be shown in characters at least one and a half times the size of the surrounding text."
"Another duty placed on businesses is that at least 66% of the credit agreements granted by them must be at or below the typical APR."
I'm sorry to say, but i know there are complaint and complaints on here about the nasty hikes some people are facing, but you are most definately the minority... same old problem, only the unhappy people bother posting which is what makes chance of getting an unbiased opinion of anything on the internet quite slim!!
Thanks for pointing me Jamalfatty .
Huh? :confused:
Virgin has wrote back to me saying that they have received my complaint and Ombudsman request - they said they are investigating the matter with utmost priiority. The deadline they gave themselves to get back to is 5th January.
I will update you on the replay friends - I am not expecting anything different from usual blah..
I really would not bother with the goverment petiton they are the biggest credit junkies. Plus thats Gordons solution get out there and skelp your cards to the limit as he needs his miracle to last until the next election. What we are seeing is the after effect of zero legislation you really should not have been allowed to borrow so heavily on credit. As for MBNA the FSA should have clamped downn on massive increases cleary targeted on the most profitable and vurnable people. But maybe the useless fsa might grow some teeth now we are seeing the full effect of Gordons miracle economy.
My only advice is try and enter an IVA that way you win and the shysters at MBNA will only get pennys back.
This may be of interest (if you'll pardon the pun!)...
MBNA response to the APACS/BERR Credit Card Summit Announcement (https://www.mbna.co.uk/principles)
I heard of many similar cases.
This may be of interest (if you'll pardon the pun!)...
MBNA response to the APACS/BERR Credit Card Summit Announcement (https://www.mbna.co.uk/principles)
Thanks YorkshireBoy.
I'll give them a call to see what's their action plan to an existing debt prior to JAn 2009.
OMG I thought I was the only person with the 34.9% Virgin Money hike!
I'm new to the forum - signed up this morning after reading through a few threads of people's queries and headaches. I think it's brilliant the support here through people's own experiences, handy hints and tips etc :) I will certainly be taking everything onboard! :)
I owe 3,500 on my Virgin card (my own fault - I like holidays and stalking bands...) so I NEED to take charge especially finding out I pay 34.9% interest! I fell off my chair when they told me! I didn't think it was possible!
I've spoken to Virgin this morning (spoke to three people actually!) about the ridiculous interest charges which I've raised with them time and time again. The chap asked whether I can afford the minimum payments of 84pm - I said 'well if it keeps carrying on like this then no I can't!' He did the whole credit check to see what he could do and told me there was nothing he could do as 'it was obvious' I could afford it. That's not the point! They should not be allowed to hike up the interest because you can afford to pay it! It'll get to the point where I can't! So basically you can ask but you pretty much need to be on your knees before they will do anything about your rates...
He did assure me that my interest rate wouldn't go above the 34.9% - comforting thought?
I'm just frustrated through no fault but my own and desperately trying to get sorted! I can't get credit anywhere and have another 3 cards to sort who's interest rates have also hiked up! Oow my head hurts :(
Anyone fancy being a voluntary accountant?? :)
Lottery win would be nice!! :D
OMG I thought I was the only person with the 34.9% Virgin Money hike!
I'm new to the forum - signed up this morning after reading through a few threads of people's queries and headaches. I think it's brilliant the support here through people's own experiences, handy hints and tips etc :T
:) I will certainly be taking everything onboard! :)
I owe 3,500 on my Virgin card (my own fault - I like holidays and stalking bands...) so I NEED to take charge especially finding out I pay 34.9% interest! I fell off my chair when they told me! I didn't think it was possible!
I've spoken to Virgin this morning (spoke to three people actually!) about the ridiculous interest charges which I've raised with them time and time again. The chap asked whether I can afford the minimum payments of 84pm - I said 'well if it keeps carrying on like this then no I can't!' He did the whole credit check to see what he could do and told me there was nothing he could do as 'it was obvious' I could afford it. That's not the point! They should not be allowed to hike up the interest because you can afford to pay it! It'll get to the point where I can't! So basically you can ask but you pretty much need to be on your knees before they will do anything about your rates...
He did assure me that my interest rate wouldn't go above the 34.9% - comforting thought?
I'm just frustrated through no fault but my own and desperately trying to get sorted! I can't get credit anywhere and have another 3 cards to sort who's interest rates have also hiked up! Oow my head hurts :(
Anyone fancy being a voluntary accountant?? :)
Lottery win would be nice!! :D
Just been through this. My A&L card has risen sharply since MBNA took over. Last month they wrote and said it was going up to over 30%. I rang them and said, basically-I'm very unhappy, this is too much and if they go ahead I'll transfer the balance somewhere else. They offered to keep my existing rate for another six months-just long enough for me to transfer it anyway. Stuff them!
Only worry now is my Liverpool Victoria card has just been taken over by them so I expect that will go silly next :(
Steve
I've spoken to Virgin this morning (spoke to three people actually!) about the ridiculous interest charges which I've raised with them time and time again. The chap asked whether I can afford the minimum payments of 84pm - I said 'well if it keeps carrying on like this then no I can't!'
There lies your problem. Whilst MBNA believe you will keep paying 34.9% they will go on charging that much because it is in their interests to do so.
Perhaps if you had just said, "No I can't afford it" then they may have been more willing to reduce the rate.
Others have succeeded in getting the rate lowered so all is not lost.
Good Luck.
Thanks Nick! :)
I mean the guy said he could see what he could do but had to do a further credit check i.e. what other credit cards I've got, loans etc which then led to his conclusion of I could afford it. I explained to him other costs such as petrol, food bills and such but he said there wasn't anything further he could do. Bandits a tell thee. I'll keep trying though and may be there will be some ruling somewhere one day or I don't know :confused:
On the up side, I cashed in 99 of loose change this morning - on the credit card we go! :j
......Try retentions (customer loyalty) on 0800 783 1116 during office hours. Tell them you think you've already had a search made by them, and ask if they'll do an unrecorded search if they MUST search you again.
The credit search is a double edged sword though. They will see all your other borrowings, and that could increase their (perceived) risk in continuing to extend credit facilities to you...meaning they still won't reduce the rate. You can't win!
I have a Virgin card and knew the interest had gone up on mine to 27.9 %, I didnt challenge them, I literally just aimed to pay them back and get rid of the thing.
Still getting no where fast, like 3 quid a month off the balance, I realised I was still paying 8 quid a month for payment protection so thought I'll ring them and get shot of that, ever penny helps.
The lady at MBNA obviously wanted to know why, I went through to the insurance bit so was pretty sure they would attempt to talk me into keeping it. I told them that the 8 quid would make a difference, however small considering how much they had raised the rate. she put me on hold and came back knocking 10% off the interest. I am happy that they have but she couldnt give me an explanation into the hike except 'we are reviewing all our accounts' - heard that many times on another forum.
I may be grateful for my interest drop which lets face it will probably go up again but I have heard so many awful things in forums about what they have done to other customers, letters, threats, telephone calls that I really can not wait to get rid of it.
Anyway, if any of you have any payment protection on it, maybe try what I did, I didnt go there with the intention of a drop in interest but it seemed to work.
To those that keep suggesting it is entirely madhusudhans fault for using his available credit, i think you are missing his point slightly. I believe his point is the way you are enticed to use this limit by suggesting its CHEAP credit, eg offering a higher limit in conjunction to balance transfer deal. This gets prudent customers to transfer a balance thinking they are saving money, as suggested in this thread:
http://forums.moneysavingexpert.com/showthread.html?t=33
However, when the low rate ends, you find your dept to at a considerably higher rate than expected, and if you canceled your old cards in an attempt to improve your credit rating you are stuck, and in debt at a much higher interest rate than if you had left your debt on your old card(s).
Balance transfers aren't the issue here from what I see of the thread, with people talking about them raising their credit limit and so they "have" to spend it 'cos its there, this is about using the credit card as a credit card, not a loan facility.
And IIRC even for credit transfers, I can't remember the exact text because it was a while ago I read martin's comments on credit cards, but I'm fairly sure he draws attention to the rate being whacked up once the introductory period is over and having to be a "card tart" as he puts it, or clear the transferred balance by then.
So either way, with all due respect, I'm not defending the likes of MBNA and their shoddy behaviour in the slightest, but people do have to take responsibility for their own actions as well.
Surprised that someone didnt pick up on this......
Errrrr they do... The new law has applied from 2004 (ish) with some of the key points on advertising APRs being
"All adverts offering credit must show a typical APR and this figure should be more prominent than any other financial information in the advert. In the case of on-line adverts the APR must be shown in characters at least one and a half times the size of the surrounding text."
"Another duty placed on businesses is that at least 66% of the credit agreements granted by them must be at or below the typical APR."
I'm sorry to say, but i know there are complaint and complaints on here about the nasty hikes some people are facing, but you are most definately the minority... same old problem, only the unhappy people bother posting which is what makes chance of getting an unbiased opinion of anything on the internet quite slim!!
I've only just noticed this reply. First of all, thank you for your clarification of the legislation about this matter. It appears that MBNA (as expected) have remained within the law. Therefore, it is my belief that the law is at fault. I believe that there needs to be equal prominence given to what a *non typical* rate is likely to be if someone doesn't meet the company's profile of a good customer. Another matter is "Is the 66% rule actually checked?" Is there an overseeing body to ensure compliance because much of this stuff could hide behind data protection legislation. Presumably, aggregate figures could be allowed that doesn't contain information that can be tracked to an individual? Yet another matter is 66% of what exactly? They could easily manipulate the 66% on typical APR figure to be their lowest debtors. I might even be on their "typical rate" now that I've cleared my balances. Therefore 66% of credit agreements could easily equate to 10% of money owed. Sorry if I sound overly cynical about lenders (not just MBNA) but the way they massage their figures to stay within the law makes a mockery of having a Parliament at all (not that I'm particularly enamoured with it).
After the complaints to MBNA and Ombudsman, MBNA has finally reduced my rate on Abbey card from 21.9% to 5.9% ! Oh boy, what a relief!
The 5.9% rate was the promotional rate in Jan 2007 and they said this would last until Feb 2008. They are not sure of the next interest rate going to be at the moment and asked me to call next week.
Thanks to all your MSErs for your continuous support!
After the complaints to MBNA and Ombudsman, MBNA has finally reduced my rate on Abbey card from 21.9% to 5.9% ! Oh boy, what a relief!
The 5.9% rate was the promotional rate in Jan 2007 and they said this would last until Feb 2008. They are not sure of the next interest rate going to be at the moment and asked me to call next week.
Thanks to all your MSErs for your continuous support!
Be really cheeky and ask for it to be fixed for LOB. Bear in mind also that they did not have to do that for you. I'm wondering if it is an idea to say to these companies that their extortionate interest rates might eventually force you onto a DMP and that means that they might get a very low payment back. Have to be careful how you word it though in case they use such a statement to alert your credit file.
Glad to hear you have a decent result for now anyway.
I'm surprised I haven't heard from them lately. Probably about to slash my credit limits.
My happiness didn't last for more than two days.
I called them today to re-check what I heard on Wednesday - well, it seems the lady who informed me about 5.9% rate reduction has given me wrong information!
!!!!!!s!
My happiness didn't last for more than two days.
I called them today to re-check what I heard on Wednesday - well, it seems the lady who informed me about 5.9% rate reduction has given me wrong information!
!!!!!!s!
My commiserations.
This company seem to have a habit of making verbal promises and going back on them. Not sure if they are any worse than anyone else though.
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