Got Perfect Credit? You Could Be Charged For It!

[ken]

Bank Of America, Citigroup First To Try Out Idea, Which Will Undoubtedly Alienate Many Who Follow The Rules
By ALEXIS CHRISTOFOROUS, CBS 2 HD News
NEW YORK (CBS) ―Loraine Mullen-Kress carries a Bank of America credit card and religiously pays off her balance.

"Flawless credit," she boasted.

Yet now, her good credit habits could cost her. Earlier this month Bank of America started notifying customers like Mullen-Kress that they will be charged a new annual fee of $29 to $99.

"There is a big segment of their population that they will have never made money on, which is people who pay their bills on time every month," said Ben Woolsey, Director of Consumer Research at CreditCards.com.

Bank of America said in a statement: "At this point we're testing the fee on a very small number of accounts and haven't made any final decisions." Citigroup is also trying out an annual fee with some card holders, and analysts expect more banks to follow their lead.

The banks are starting to charge fees to reliable customers in response to a slew of new credit card industry regulations that will limit when banks can hike interest rates. Cardholders who get a new annual fee notice in the mail will be in a no-win situation.

"They can either pay that fee or they can close the account, and if they have had the account for a while and they close it, they are potentially going to hurt their credit card score," said Woolsey.

Analysts say right now the banks are trying to figure out what their customers will tolerate. Many say they'd cancel cards with a high new annual fee.

"I think it is really bad. They're encouraging you to be a bed creditor or not have good credit," one New Yorker told CBS 2 HD.

Said Mullen-Kress: "An annual fee would not be tolerated."

Credit card companies call the fees an experiment. Whether they stick depends on whether customers are willing to pay for something that's been free for so long.

If your credit card company does start charging you to carry its card, call and complain. If you have a good credit score and you've been a loyal customer, they may be willing to waive the fee to keep your business.

You may also see annual fees go up on cards that offer rewards like miles and hotel rooms. That's when y ou'll have to weigh whether the rewards are truly worth the higher fee.

[computer2slow]

Not exactly new. A lot of cards used to card an annual fee for the privilege of having their card.

[jabthehut]

The best way to avoid CC fees is to not own one. I have Visa and Mastercard debit cards and the only fees I incur are ATM fees when I don't use my banks ATM. I have had to do this only once in the past 5 years. If you need cash, you can always use the debit card to buy a candy bar at Walmart and get cash back.
Once I got rid of my CCs in 1996, my life changed drastically. Well, maybe getting rid of a wife helped out too.

[petruccio]

From having been inside the industry I can tell you...Banking and Insurance are the two biggest legal "rackets" in existence today.

It's like big-money gambling in Las Vegas....the house just cannot lose...with very few exceptions, ALL of the laws and regulations are essentially on their side thanks to literally decades of bipartisan big-money lobbying with congress.

They can bend you over and force you to accept it and the average citizen has almost no adequate recourse for satisfaction.

If a bank or an insurance corporation goes "belly up" it is almost universally because whomever was making the decisions was either stupid or grossly negligent...or both. You really have to be an idiot to have a company lose money in either industry

You just cannot fail to make money in these industries if you are on the iniside and are making reasonable decisions. The rules are just simply all in their favor.