Did the credit card company push you into it?

[keepswimming]

July of 2010 is clearly too late for all of us. Absolutely this is what led to our BK. Skank of America reported us LATE IN ERROR (we have never ever been late on anything!). This was back in Jan or so of 2008. Well, this MISTAKE was the green light for our other creditors, ADVANTA being the first, to raise our rate to 38%!!! All our debt was personal credit cards that we used to purchase business inventory with. Dumb, I know. But we were paying for it, even when the bottom fell out of our business, and we could not sell that inventory, we were still paying for the debt with our jobs. But when the rates started going up, we could not make it work. When we stopped paying Advanta because we truly felt they were just stealing from us because "they could", then of course the other cc companies jacked up rates and slashing limits. I honestly feel that if every card had just left the balances and rates alone, we would have figured out a good solution by now. I feel that if BofA had not reported us in error as being late (which I finally got them to fix after months and months of letters, contacts, bureau reports, and even ftc), that we could have worked through this. However, all the cards are in the hands of the big banks. They can do whatever they want. They get their money either way. I really am considering pursuing recourse. I would love to sue BofA. Ironically, we surrendered our home that we loved living in for nine years, to BofA last week. They started it, and now they get the last laugh. Sick. Sick. SICK!

[2manybills]

Yes "Skank of America" was the first" and then away it went. Didn't stop either. Man oh man!

[keepswimming]

I really wish Bank of America could get their hineys sued off! I have been waiting to hear back from an attorney that I want to meet with to discuss the possibility! It is just sick! And they get away with it every hour of every day, one way or another.



Filed (finally) November, 2011!

[forgotten]

BOA told me I couldn't skip a payment when my wife lost her business, if I did they were going to raise my 3% fixed APR to a 29% default APR. No matter how much I tried, they refused to keep my interest rate if I missed a single payment in 5 years.
So, I just stopped paying... everything... that was the straw on the camels back. I had a $50k balance, instead of interest being $125/mo it was going to be $1208/mo.

The funny part? BOA didn't even bother to file a claim in my CH13. Proof they really don't want anything if they can't get it all.

[keepswimming]

So, I just stopped paying... everything... that was the straw on the camels back. I had a $50k balance, instead of interest being $125/mo it was going to be $1208/mo.

The funny part? BOA didn't even bother to file a claim in my CH13. Proof they really don't want anything if they can't get it all. [/QUOTE]

To them, the funniEST part is they will get it ALL anyway. That's what they have insurance and taxpayers, and other consumers to screw over for! For me, Bank of America forgot to take out the FINAL payment on a 13k balance we paid automatically for years and years. the pymnt was 202/monthly. That infamous "last payment" that was reported LATE in error, was only 35 bucks!!! and i noticed they did not take it out just six days later, and yet they still reported it 30 days late on bureau. Took me MONTHS to get that off my bureau reports as it kept jumping from bureau to bureau, then showed up mysteriously (or not) under other/old account numbers etc. It was a mess. Meanwhile I had to pay 38% interest to advanta because of it, and then all the others joined in. Years of stress to date, and we have years to go now that we joined the ranks of fellow filers of bk. Yet, they go on ripping people off every way they can think of. Let's not even talk about the customer service (using term loosely) in the mortgage dept. THere is no way on earth that they are all this DUMB and incompetant. CLEARLY, they are trained to give consumers the run-around on purpose. No one can convince me any differently.

[clevelandmom]

You know, this is amazing to me. If cc companies are the underlying cause of SO MANY PEOPLE going bankrupt, then WHY is this still going on? The people responding to this question DID NOTHING WRONG! Everyone here was making their payments, never late, going along just like the average Joe - and then BAM - the cc companies doubled and tripled minimum payments, raised interest rates and were ALLOWED TO GET AWAY WITH IT. So many people here signed contracts with low interest rates that the cc companies decided to just raise. Can you imagine if you signed a mortage agreement and your mortage payment was $1,000 per month, but because the bank got greedy, or the "criteria changed," the bank suddenly (and without warning) increased your monthly mortage to $2,000?!?!!? That essentially is what these cc companies are doing!! What pisses me off even more is that the BK is a scarlett letter for 10 years, and God knows what else, and - I repeat - WE DID NOTHING WRONG!! This is SOOOOOO not fair. Yes, cc'ds is what did me in. We tried a debt consolidator because the cc's increased everything so much. That didn't work though - I got sued anyway. The lawsuit is what forced me into BK (and dh's unemployment). Maybe the previous poster is right - this whole country is going to go bankrupt one day and it will be a cash only society. Those of us in this particular boat may actually come out ahead because we're ahead of the game. Just sayin'. Crazy.

[enuffznuff]

Just to add another one, yes this is a huge factor for me as well. ALL of my cards jacked my 8-10% rates to an avg of 29.9% with NO late or missed payments EVER and all but a few slashed credit line to just over what I owed. (By like $50). Also, several of them took their sweet time sending the letter saying the limit was reduced. I saw it because I use online statements and noticed it in the account summary, but it was a full 3 weeks before I got the letter, in which time I could easily have made a small charge that would've put me over the limit if I had not seen the reduction online. (The reduced my limit by 9,000 in one swoop, so had I not seen that online I'd have THOUGHT I had 9K in available credit when in fact I had $50)
The BK for me comes down to a house /2nd mortgage deficiency issue but if this hadn't happened with the cards, i could've handled the mortgage issue. I will be unable to shoulder both.

[msm859]

My story starts a little further back from the credit cards. Started a loan modification on my first when after several months I learned I would not get one unless I was late so I quit paying. After missing 2 payments they finally took me seriously and got a loan modification -- although I was told I actually have to be 3 months behind (per my investor - Bank of America) to get the mod. I then went to settle with my second Citibank which I ultimately did paying them off at 15%. However, because of all of that the common snowball occurred. All my credit cards slashed my credit lines or closed my cards -- even one that I owed zero on. My original plan for "stage 3" was to try to settle with all of my credit cards. However, that would only work if they all were on board. It became patently clear to me that was not going to happen. So after taking the emotion out of it the obvious business decision was to go BK. The government does not care about the common person and neither do the corporations. If you don't look after yourself no one will.

[jeep75]

I know this is a bit of an older thread but I read last night only 9% of filers didn't lose a job, get really sick, or get a divorce and I remembered reading this thread when I first joined.

We are in the same boat as a lot of you, we had never paid a bill late in 15 years, always paid at least the minimum, more commonly two or three times the old minimum and had been doing so for years, had really low rates, usually zero and if it went up we moved it to another card. As we know all of a sudden we start getting letters that our minimum payments were going up and our credit limits were going down. The minimum payment thing really threw us as if we had a bad month we could just send the old minimum, the lowering of the limits not so much.

My wife came home from work one day in a frenzy and explained that after making the new minimum payments we were being forced to use the cards to live and creating a repeating cycle each month. I started searching the internet for a solution and found these forums.

[bluemartini]

Yes, to this day I still feel the credit card companies pushed me into it.

I had accumulated a lot of credit card debt from repairs on my old house .... the house was a lemon but that's another story.

I was trying so hard to pay off my credit cards -- I was making it just barely, but I was making it. Then I needed emergency dental surgery asap -- so I contacted the credit card companies and pleaded with them to work with me just for a few months until I could get the surgery completed. I tried everything I could think of -- asked if we could temporarily lower the payments, temporarily lower the interest rate, add the payments to the balance, etc., but they just would not budge.

I literally had no choice but to go through with the surgery. I was in such serious dental pain that basically my dentist had to put me on elephant tranquilizers, LOL... I defaulted on several of my credit cards and tried to continue paying on a couple of the others, but finally I realized it was a losing battle and I defaulted on everything. My house went into foreclosure and I knew it was time to face the music.

If the stupid credit card companies hadn't been so greedy, they wouldn't have gotten the shaft. I have no regrets or guilt about it whatsoever. I probably would have eventually been forced to file BK anyway. But if they hadn't been so stubborn, they certainly would have gotten a lot more money out of me for a while longer.

Their refusal to budge or work with me just speeded up the process of me giving them the heave ho. Too bad, so sad.

[out4good3]

I know this is a very old thread, but this is whathappened to me as well. When the Credit crisis hit in late 2009, I had about $30,000 in CC debt but was managing it well paying at least double the minimum.

Out of the blue and without warning, the CC companies started one by one lowering my credit limits and jacking my interest rates. What pushed me over the edge was Citi. They rate jacked me on a CC I had a $15,000 balance on from 9% to 29.99% variable and wouldn't budge on lowering the interest rate. I several people telling them that if they wanted to keep the rate that high that they wouldn't get paid. So, the very next month, I stopped paying them.

A year later in early 2011 a process server was at my door. 6 months later, just last week, I'm filing for BK. Before the BK at least half of my net was spend floating credit card payments. My BK payments are now at only 16% of my net for 5 years giving me a lot of breathing room.

[jmcm030111]

Pushed? AND pulled, drug, cajoled and whatever else you want to say. Credit was too free and easy and we fell prey.

Absolutely, positively...YES! For 30 years we played the game of inflated rates, reduced rates...better offers, larger balances, using A to payoff B. All the while handling it responsibly and without missing a beat. Then...whammo...this rate goes up, and another, then another...after years of agonizing, we decided enough was enough. The final straw was when we called all of them before we went late on anything...BOA, Chase, Discover, CB and begged for help...all we wanted was an extended term and reduced payments. To the one, they all rejected our requests...only offering reduced payoffs after our income was reduced and we were late on a few. Amazingly the offers got better, the later we got. As I said to them...IF I had the cash to pay you off, we wouldn't be talking about this...lol!

Anyway, we ultimately pulled the plug and filed CH7 and feel very little remorse towards the banks. It was their greed to "feed the tiger" that caused this to happen. Yes, we were responsible...but they kept feeding us...they profited from our bad habits for 30 years and when we needed help said no. Good riddance!

[lillymarlene]

Yes it definitely was the credit cards. Like a lot of other people I had credit cards for over 30 years. I used them for about everything, it was just too easy. I started with "junior" store cards when I was 18. Then I finished college late in life (in my 30's) and of course financed my education with credit cards. Then later, if I needed something in my business, it went on a card. Everything seemed fine for years, or so I thought, I always paid more than the minimums. However, each year I managed to spend about $3,000 more than my net income.

Well, then came 2008, the economy tanked. My business had a big drop in sales. BOA closed 5 of my cards, claiming they didn't like my debt/asset ratio. (I didn't either. :-) My minimums doubled, then tripled with the other cards, I began to be late, late fees were added, my interest climbed to 29.9 %, my cell phone would't let me out of contract and shut me off.

Finally March 2010, a summons from a law firm hired by BOA, was taped, for all the neighbors to see, to my front door. It was quickly followed by another from Cap One. The only good thing about this was that it became my wake-up call. I finally realized I had to do something drastic, like file bk. And, I'm not sorry I did, most of my problem too, was with the big banks who made it all too easy, and later refused to work with us.

[JackBondLove]

Just curious, wondering how many of us may have been pushed into this by the cc companies raising minimums/lowering credit limits and/or raising interest rates. Was this the thing that opened your eyes and made you realize that BK was the only option?

Also, was it a blessing in disguise for you? How many of us do you think would have continued in that vicious circle for who knows how long?

For me, Amex and Chase really opened my eyes when after ten years of never paying late they dropped my credit limits to what I owed (or less, can't figure that one out), raised my interest rates and my minimums just because they could.

I always knew that BK was an end option if my income situation did not improve (i.e., got a job!) On an income of 0$ (I was self-employed before my business collapsed, so I did not get any unemployment), I was spending $1500/mo on living (including renting a short-term place since my home had been destroyed in Katrina) plus about $3800/mo in debt service! Chase decided to up the minimum payment from 1.5% to 5%, so my debt service went up to $4700/mo. At the time I only had about $36K in liquid assets and a property that I ended up selling for $24K. That raising was the impetus for me to at least consider the whole situation - which uncovered that I could shield $35K by buying a home (ended up getting one for $39K, so I had to give the trustee $4K after the discharge) as well as my grand piano (LA allows musical instruments as non-exempt .) I had calculated that since I could have gotten a very low interest rate (as a Katrina victim) on a new house, it was worth it for me to stick it out to some extent. However after calculating how mush stuff would be exempt, I figured there was no way I could have come out ahead by paying back the debt, even if I had gotten that loan. The path of BK was then by far my best course of action.

After consultation with an attorney who said that it was OK for me to buy non-exempt stuff on the eve of BK, I started figuring out how much stuff I could buy (including fixing any issues with the new home), and figured that I had about 5 months of living expenses, after which I would just about be at the point of not having any remaining cash, so I decide to stop all the payments and wait until I ran out of the cash (to give maximum time distance), and then filed for Chapter 7.

So in a way, you could say that Chase's harsh treatment gave me the impetus to investigate my options ahead of schedule, which allowed me to maximize my financial situation post-BK. Thanks Chase!