What should the correct finance charges on credit cards be?
Question Details:
The credit card company reduced the interest rate to 11.99% due to a financial situation (resulting from a loss of income) for 6 months(the actual rate is 25.99%). Now a letter has been sent advising that in January the rate will be 29.99% or you can opt out and your rate will remain the same as it is "right" now. After talking with the company they advise the rate will be the 25.99% not the 11.99%(which it is "right " now). Can they legally change the rate from the 11.99%(which it is) to the 25.99% because that is the actual rate if we opt out?
Business Law Answers
It's not right, it's not fair, and Congress really needs to do something about it, but the said reality is that credit card companies legally can and regularly do exactly what you're describing. Your best recourse is to write your member of Congress about it and contact any reporters on your local television news stations who specialize in consumer advocacy. This is a big issue for a lot of people, and if you can get yourself on the local news you might be pleasantly surprised how cooperative your credit card company will become if they are facing the prospect of adverse publicity. Legally, however, there is precious little you can do.
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