A co-worker of mine got a letter on this from Captial One yesterday.

They raised his rate from a fixed 8.99% to a variable rate of Prime + 7.5% or something, effectively doubling his rate on purchases. He called and spoke with a CSR and supervisor. He said the supervisor sounded a litte flustered and indicated he had been getting a lot of calls on this issue.

In the end he got the rate back down to 7.99% which he was happy with. He has had the card for 4 or 5 years, and did't really want to get a new card even for 0% on purchases.

He had a sweet offer in the same mail in his wifes name for a 0% transfer for 15 months on a Chase Platinum card with a $99 BT fee cap. I couldn't figure out any way to use this offer myself as it was a targeted invite. Any ideas?

Cheers

the transfer to another lower cc only works if you do your own calculations. you don't want to be paying a high bt fee that's for sure.

seems that capitol one can't keep charging below prime for a long time, so the rate increases seem like a natural progression. that just goes to show you that you need to read your monthly statements for any kinds of changes, and second that cc companies can change terms any time.

I got the letter from Capital One. There are two important aspects to this APR issue.

First is that basically the APR is doubling. Second is that it is becoming variable. This means as the mortgage business continues to head south your variable rate could hit the roof.

I canceled my card by the way. I can see robbery when it is staring me in the face.

I also got the infamous letter a few days ago, raising my rate to 15.99% I was a little suprised they did this as I always pay on time and have a $3,000 balance on the card. I immediately sent a letter to the customer service dept. and asked them to drop my rate back down to 9.9% or I would cancel the card and never do business with their company again. I'm looking at a 0% into offer card until Oct. '08 with 9.9% after that.
Good bye Capital One

I had an interest rate of 5.33% and got a letter informing me of a rate increase to 14.99%. I called them up and asked why such a big increase. They said they were doing it across the board when your rates come up for renewal. I questioned why they would do this to good customers with excellent credit. They said it was due to the economy. I wonder what they think the impact of rasing rates so drastically will be to a weak economy. Anyway you can call and close your account and you can pay off the balance at your lower rate. Also I went to creditcards.com and signed up for a card with zero interest for 12 months and prime + 4.99 thereafter. (Would be 8% currently). Oh well, I guess they are willing to lose good customers. I hope this greedy company doesn't go back for more bailout money.

I got the Capital One letter today. Our interest rate went to variable with a current rate of 15.99% from a longtime rate of 6.90%. Our payment is always more than the minimum and always on time. Fortunately at the moment our entire balance is on a different card that is 0% for a number of months. I can't foresee transferring it back to Capital One, a company that I previously had a great deal of respect for and would have recommended to others.

It seems really strange to raise credit card rates when interest rates have dropped. I think it is also unfair to ask credit card users to make up for problems in the mortgage market. We are no longer using credit cards but still have a sizable balance to get rid of.

I got a letter from capitalone several days ago. They stated that they changing my rate for 8.9% to 29.98%.
The letter informed me that if i don't agree with the terms, i should pay my balance and close my account.
Well, i will transfer the $500 balance i have with them to another card.
Since they are robbing me, i will avoid all business i have with them and so long for the last 5 years!!
What a way to loose customers!!

I got nailed by Capital One too. This is the financial equivalent of taking it in both ends. There are numerous websites with similar tales of woe and, for whatever good it will do, I have written to my Congressman, Frank LoBiondo, 2nd Dist, NJ as follows:

Mr. LoBiondo -

Please refer to the following website regarding recent actions taken by Capital One Bank in announcing a unitlateral decision on its part to significantly raise the interest rates on the credit card accounts of its customers after accepting signififant TARP funding.

http://www.consumeraffairs.com/credit_cards/cap...

My notice from Capital One advised me that "Due to extraordinary changes in the economic environment", as of April 17, 2009 my interest rate will increase from the current rate of 5.06% APR to 13.9% (a 174% increase). This is being done despite the fact that I have never been late, have never exceeded my credit limit, always pay more than the minimum due and have a credit score in the upper 700's.

I certainly don't expect you to spend your valuable time addressing my specific dilemma as I am just one person directly affected by this action by Capital One. However, as evidenced by the information at the link provided, there are surely countless other constituents of yours similarly and adversely impacted by this action and possibly similar actions by other credit card issuers. On behalf of all of them, and myself, I would respectfully urge you to have Congress assess the justice in a situation whereby citizens, as consumers, are unilaterally and without recourse, mandated by a financial instution to pay them substantially more while, concurrently, that same financial institution receives, and gladly accepts, 3.5 billion dollars in relief from those same citizens as taxpayers.

Unfortunately, "we the people" do not enjoy the ability "due to extraordinary changes in the economic environment" to make self-serving, unilateral decisions that solely benefit us.

Yeah, same thing here. I have spotless credit, have never missed a payment to anyone on anything ever, and I typically pay off the Capital One card every month when I use it. I like that they absorb the foreign transaction fee from VISA, which is why I keep and use this card. Some time ago they converted it to a "rewards" card, so I get a 1% rebate on my purchases as well.

However, my 7.99% fixed rate is going to 16.49% variable. If you call 1-800-889-9939 you can talk to an "account specialist," who may or may not be able to fix this. I'm going to talk to them tomorrow. Every few years, Capital One tries to pull a fast one like this, and usually backs down when I call them on it. If they don't back down this time, I'll draw down my full $10,000 credit line as cash and close the account (so I can pay it off under the existing terms). 7.99% isn't a bad rate for an used car auto loan right now, and I plan to buy a van anyway. :)

We just got this letter today: our interest rate is going up to 19.8% as of October 2009! We our taking our cancel card option and transferring what we can to a lower card.

There's at least one lawsuit on this

Lawsuit claims that Capital One engages in unfair and bad faith business practices with respect to its unilateral increases in the interest rates charged to consumer credit card accounts.

Atlanta, Ga. (PRWEB) August 14, 2009 -- Atlanta attorney E. Adam Webb has filed a class action lawsuit against Capital One Bank alleging that Capital One has operated in bad faith by unilaterally increasing the interest rates on consumer credit card accounts. Capital One has raised rates even for consumers who have always maintained their good standing by satisfying all account requirements, such as making all required payments and not exceeding credit limits. Furthermore, Capital One has taken such action even against those whose credit scores and general creditworthiness have not declined. The suit claims that Capital One, which is headquartered in McLean, Virginia, has engaged in improper and unfair practices in order to increase the revenue it generates via the interest rates imposed on consumer credit card accounts. The case, styled Lemond v. Capital One Bank (USA), N.A., is pending in the United States District Court for the Northern District of Georgia and has been assigned Case Number 1:09-CV-01582-RWS.

According to the suit, Capital One raised the interest rates associated with credit card accounts by over nine percent even though accounts were in good standing and had been at all relevant times. Although Capital One did not purport to impose these new higher rates on balances accrued prior to its notice to consumers, the effect is the same because of the Bank's practice of crediting all payments to the portion of the account balance with the lowest interest rate. In addition, the suit alleges that Capital One's offer that customers could reject this interest rate increase by closing their credit card accounts is inadequate because, as Capital One is well aware, closing a credit line has a negative impact on a consumer's credit score. A lower credit score can cost a consumer thousands of dollars over the term of a home mortgage or other loan. As a result, customers have been forced to accept Capital One's unilateral rate increases.

The Plaintiffs allege that Capital One is liable for all damages that have resulted from its bad faith and improper conduct, to include the differential in interest payments paid by the class members to Capital One.

If you wish to discuss this action or have any questions concerning this press release, please contact E. Adam Webb., Esq. by e-mail at contact(at)webbllc(dot)com or by calling (770) 444-9325.