Does this sound familiar to you?
I called and paid a credit card down to zero a month or so ago. (Issuing bank Capital One.) Soon after I got a statement in the mail from them about how they are now accelerating my interest payments to something nearing 30%. What gives?
In chatting with a friend recently who works for CreditCards.com we were ruminating about the Obama protection plans that were going into place to help protect credit card holders from such usurious practices as moving your promotional rate (say of 0% for 12 months) up to 29.99% if your are over 24 hours late in paying your bill. Or what's known in the business as ZERO grace, ZERO tolerance.
So I just canceled my Capital One card. When asked, "May I ask why you are canceling your card Mr. Ma.. muchelli?" by a woman who sounded more like a machine than the voicemail tree that took me 5 selections to get to her. All I could say was, "Worst service ever!"
"I'm sorry to hear that Mr. Ma.. muchelli?"
My friend, who's "in the business" now, was talking about CitiBank and how his rate had jumped to the maximum allowable percentage rate the same day he paid down his card to zero.
"It seems like they are doing the opposite of customer service."
We both wondered why the strategy of these companies had become so predatory. Is it the economy? Is it our poor credit ratings that are causing us to have amazingly high credit card rates? Or is the economy locking some of us into our current credit cards, and as the companies move us up the spiral to the worst possible rate for us, the best possible rate for them, they are expecting us to grin and bear it? Is that what is causing the poor customer service?
Is it a gold rush to get to the highest rate *before* the Obama plan is in place?
One final example of the BAD service that seems to be rampant among all the traditional banking institutions. And an example of GREAT service I just got from a local credit union.
First the bad comes from Bank of America. We have had our primary banking at B o A for about 10 years. And we love the online bill pay system. BUT… the B o A AMEX card that I had protecting our checking account from incurring any overdraft charges, had somehow ballooned to the mythically bad 29.99% rate. Oh my. So I called B o A Card Services about two weeks ago to ask for a reduction in the rate. See, I had made one minimum payment about a week late. I figured the service representative would work with me to keep the AMEX card and it's owed balance at B o A.
Early in the conversation I said, "I want to cancel my credit card."
The gentleman who had to repeat several phrases more than three times as I struggled to understand him, then proceeded to ask me some questions about why and how and seemed to be working me back into the fold of B o A. Boy was I wrong.
About ten minutes into the conversation regarding rates and options, I said, "Okay, so after you say that, I'd like to keep the card on this account for a few more weeks."
"I'm sorry Mr. Maclepoopoo, I have already canceled the card?"
I paused a beat.
"What? You already cancelled the card?"
"Yes, Mr. Maclepoopoo."
"Can you stop the cancellation?" I asked more irritated than worried.
"No sir, I can connect you with our card services "new accounts" representative, but I'm afraid you would have to reapply."
"Wow." I exclaimed. "That was the worst customer experience I've had in a long time!"
I pinged right then Creditcards.com and applied online that night for a new VISA from B o A. You can only protect a checking account with an internal card.
Well, my credit is actually pretty good and I was approved online in about 3 minutes for a 0% promotional rate for 8 months, and a $7k+ credit limit, on the spot. No waiting. So here's the kicker. I could not link the new account with my checking account until the card actually arrived, 7 – 10 business days, according to the site.
I laugh now.
And now for the best experience.
Yesterday I bought a car using Randolf Brooks Federal Credit Union. I went to the branch in person, and I'd have to say the gentleman spoke great English, in fact he graduated from a local university and had been with FBFCU.org for almost ten years, or since he graduated. NICE!
The "entire" process at the credit union took about 30 minutes. I walked out of the branch with a pre-approved "power check" for over the amount I had already negotiated on the car. The dealer picked me up at my house and we did the paper work at his office in about 20 minutes. DONE! New car to Taco Bell with son for dinner.
So… Something is happening in the services business. And it's happening all over business, not just credit card companies and banks. People are beginning to expect to be treated with respect again. And if your business experience is crappy, well, we will vote with our business and our money and move it all somewhere else.
Now I am fortunate to have been recently re-employed after almost a year of "consulting." So my self-employment was a blip rather than a trend. However, to those who are struggling under debt, mortgages, car payments and low employment, the situation is much worse. And for some reason the credit card companies are treating everyone with the same contempt, as if we are all default on everything.
So I've got a new credit card with a 0% promotional rate. I'm guessing the leap to 29.99% rate is not very hard to trigger.
But I am considering ending my entire relationship with B o A and moving everything to Chase. And all because someone in Bangalore was a total ass to me. Perhaps he was having a bad day, perhaps it was his first day on the job and he was a C-level student in English as his university. But B o A is the one with the problem. If they continue to "outsource" everything to phone trees and robotic humans, more and more of us will seek out credit unions and better treatment from other institutions.
Have you had similar customer service issues?
@jmacofearth
permalink: http://bit.ly/killer-cc
PS. I give thanks daily for the good fortune and hard work that landed me at my new position with a former mentor.
Update 2-5-10: Between a cc and a hard place. Speaking with a friend who is on the harder side of this story. Unable to move the debt to a different company, this individual has had the cc companies bump her cards to the maximum amount and she does not have many options.
Disclaimer: I am in no way affiliated with any of the financial institutions in the story, or do I derive any benefit from mentioning my positive experience at http://www.FBFCU.org. But if you ping me I will give you my loan officer's name and number because it will be GREAT for YOU like it was for ME. At 3.7% interest rate on a USED car, you will quickly see the rate is amazing too.
