Big Bank Sticking It To Customers

Hi Everyone:

My wife received a letter this past week from JPMorgan Chase Bank, N.A. It was one of those, "You are pre-approved for a Chase Freedom with Exclusive Benefits", a Visa credit card. We get these alot. Having good credit means you are inundated with these offers.

Not that we need another credit card, but we decided to read the entire offer. The following is exactly as it appeared on the Pricing Information and Interest Rates and Interest Charges page under the heading - Penalty APR and When It Applies section:
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29.99%. This APR will vary with the market based on the Prime Rate. (Ed note: It is really 26.99% plus the prime rate, as stated in the very fine print at the bottom of the page. The penalty rate will increase when the prime rate increases).

The Penalty APR will be applicable to your Account if you:

• fail to make any Minimum Payment by the date and time due (late payment);
• exceed your credit line (if applicable);
• make a payment to us that is returned unpaid; or
• do any of the above on another account or loan you have with us or any of our related banks.

How Long Will the Penalty APR Apply: If your APRs are increased for any of these reasons, the Penalty APR will apply indefinitely.
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Did you catch the problem I have with this offer? FYI, I have no problems with the first three, although a 29.99% penalty rate is excessive. But if it is legal to be able to charge that amount, so be it. My problem is with the last condition. To me, it states that if you do any of the first three with any other JPMorgan Chase account or loan or with a related bank, they will apply the 29.99% penalty APR to your Chase Visa Credit card. So if you are late with a payment to a Chase loan etc., etc., your credit card rate will increase?!!!

We couldn't believe it, so I took it a step further. I called Chase and spoke with a customer rep. The rep's response to my questioning that condition was very evasive. The rep kept saying that they "might" raise the credit card rate. I responded that the word "might" is not there and as I read it, they "would" raise your rate. Getting nowhere with the rep, I then asked to speak to a supervisor. The supervisor's responses were even more evasive. He also used the word "might" but kept dwelling on the first three conditions dealing with the credit card solely. After 5 minutes of playing word games, I finally got the supervisor to agree that Chase would indeed raise your credit card rate if you met any of the first three conditions on any other Chase account or loan. I then asked the supervisor if that made any common sense? He again became very evasive and wouldn't directly answer. I told him that it didn't make any sense. I said that anyone who reads all the conditions and fine print would not sign up and be subjected to that 4th condition and that it seemed to be based purely on greed. Believe it or not, the last thing the supervisor said to me was if I wanted to sign up for the card? I told him that it was obvious that he hadn't listened to what I had been saying so I hung up.

So there you have it. Please be very careful signing up for a new credit card in these times and make sure you read every single word in the offer, including all of the small print. Big banks lost their common sense years ago with the sub-prime mortgage mess and continues to this day. Big banks have replaced common sense with greed. They even train their customer service reps and supervisors on how to be evasive and deceitful. WATCH OUT.

Common sense rules and greed still and always will drool.

Til next week.

Peter