Just when you hoped it was the season of peace, love and goodwill to all men, along comes a credit card company to dispel the festive feeling.
A member – linday – has written in with this story, which we think is pretty scandalous, but we also think is pretty representative of how the financial services industry works…
I have a £10k balance on my Virgin Credit card. It started off as a 0% balance transfer which is why I moved balances from other cards to it. Of course I wasn’t stupid enough to expect it would always stay at zero and the normal rate kicked in after the promotion ended at approx 16.9% (normal) and then over the course of the next few months increased rapidly until about 3 months ago it reached about 21%. I phoned to ask what was going on as interest rates haven’t increased. They said that for a fee they would get their underwriters to review the rate and give me a personal rate. I agreed, paid the £200 fee and they reduced the rate back to its original rate – sorted, the fee would be repaid by interest I wouldn’t have to pay. This week they’ve sent me a letter to say that after 1st Jan the rate will rise to 24.9%!!!
I therefore applied to Zopa for a loan and as long as it’s approved I will be paying £100 per month less and saving over £3,000 in interest!!!
Say no more….