So after becoming listeners/readers/fans of Dave Ramsay, we began our journey to becoming totally debt free. We decided that we would take it to the limit and drop all credit cards permanently. That is still the plan.
Since October 2009 we have paid off over $15,000 in consumer debt. Absurd, right? (I mean the amount we have to pay off, not the fact we have done it; I rather love that part) I will admit (ashamedly) that we still have a long way to go, but we are making our way through it and killing off credit cards as they are paid off.
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The current target of our debt snowball is a Chase card that was my primary card since graduating college. It has the highest credit line and the longest credit history attached to it. It also had the highest balance on it. The snowball method would indicate that we would pay it off last (we have one other card with another high balance although not as high as this Chase one), but this one is getting paid off next because it will be a huge emotional win.
You see, I was a good customer of Chase's, as far as credit card companies define good customers. I had a high credit line because I would carry a balance for long enough to please them and then pay it off in full. Each time I paid off a big balance in full, due to the way credit card companies have acted in the past, I would get a credit limit increase. I finally asked them to stop increasing my credit limit when it reached $24,000. Yes. $24,000. On one card. Ridiculous. They obviously thought I should be able to purchase a nice new car on that card.
Last summer I got a nice letter from them telling me that my minimum payment amount would more than double. I was floored. Frankly, I couldn't make that payment because I was deep in debt with not only them, but with three other cards. I called them and told them so. They increased my interest rate and left my minimum payment percentage the same. It hurt, but I had gotten myself into that mess and I didn't have any choice.
Upon investigating this in anger online, I found that Chase did this to over 1,000,000 of their customers. What did these customers have in common? They had previously transferred a balance at a "lifetime low" interest rate, they were employed, and they consistently paid their bills as required and on time. So they were wanting to punish those customers who were most loyal to them and responsible as far as that word can stretch in the credit-card carrying person's dictionary. Yep...increasing the payments of those they were most certain they could get a payment from.
I was furious. After 8 years of carrying that card, this was my reward for using it the way they wanted me to.
I vowed then and there that once that card was paid off, I would never use Chase again for any of their banking products.
That's all back story. Here's the current deal:
So, I open my mailbox last week and I have a letter from Chase. It states the following:
We are writing to provide you with important information about your account. In an effort to ensure the credit we extend is appropriate for each customer, we regularly review customer credit lines. Based on our review of the account referenced above, we have changed the credit line to $15,000.00.
The review of your account considered several factors including our assessment of information obtained from the consumer credit agency listed below. The primary reason(s) that led to our decision to change the credit line are:
- Balance owed on revolving accounts too high.
- Balance too high compared to credit limit
We understand that you may be disappointed with this decision, but we hope that you continue to find value in the benefits, protection, and payment flexibility your account provides. If you have any questions....
So. There it is, ladies and gentlemen. My credit limit has been decreased.
Why? Well, I agree that my balance owed is too high, so I cannot argue with that.
However, the crap about my balance being too high compared to my credit limit? Well, my ratio of balance to limit is higher now thanks to my limit decrease, so I don't really buy that.
You see...they see that I am paying this sucker off. In pretty hefty amounts. Every month. And they see that I'm not using it. At all.
So they are ready to close my account as soon as it is paid off. And you know what? I am too. That's the first thing I have agreed with Chase about in a while.
So why my feelings are not hurt by any part of this letter nor the actions associated with it, I find it humorous that Chase suddenly is concerned that my credit ratio is too high. They are concerned that I cannot pay my bills although they have NEVER not received a payment from me.
The dishonesty associated with most of the credit industry (I only say most because I can't lump absolutely everyone into the same category. I'm sure there are good people out there. Somewhere.) sickens me and further confirms and solidifies our decision to be done with them once and for all.
And Chase...by the way...I am not "disappointed with this decision," and I have not found "value in the benefits, protections, and payment flexibility" with my account in a long time now. So really...don't let that concern you.
By the way...I'm not trying to pick Chase out from the bunch. Most credit card companies are doing something similar these days. Chase just decided to do it to someone who would blog about it.