Bank of America recently bought MBNA and greeted their new customers by charging them a new fee.
Now if you don’t pay off your entire balance in full every month, BoA will impose a $1.50 minimum finance charge.
According to Boston.com, this is one of the “highest ever seen” minimum finance charges for the banking industry.
Ex-MBNA customers must send a letter to BoA, and it must reach them by May 1, in order to reject the charges.
To that effect, reader Mary Marsala with Fries sent the following acerbic letter…
(Photo: Betsssssy)
Hello,
This letter is to inform you that I find your attempt to change the terms of my contract in ways that negatively impact me, without offering any type of compensation or positive benefit to me, absolutely abhorrent. I categorically reject each of the changes in terms — at the very least, the addition of a minimum finance charge. I would also reject each of the other changes if possible, since obviously none of them are in my interests as a customer, but I cannot tell from your letter if you are giving me this option (or are required to give me this option) or not. If I have the option to reject any of the other changes to my contract, I hereby do so. The change in payment due-dates especially is a truly disgusting thing to attempt to do to someone’s account, and an obvious money-grab for more of your obscenely-overpriced late fees. I have always made my payments on time — obviously that bothers you. Awww, poor you.
I have been a customer of MBNA’s with these accounts for several years, but your onerous business practices and bullying have totally put me off doing any further business with Bank of America. I refuse to give money to a company who will change the terms of my contract for the worse at any opportunity, and force me to do the legwork just to keep the same, barely-satisfactory terms I had before. I will be seeking a new bank to hold my credit accounts immediately, and advising everyone I know to do the same.
And on a more personal note, kiss my a$$.
Here’s a copy of the letter BoA sent its new customers informing them of the changes. Click to enlarge.
— BEN POPKEN
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What hit me, and hit me hard when BOA took over my MBNA card, was they moved up my due date with no notice. Essentially my bill was due 1 week earlier than normal, I didn’t catch it in time, and because of that my payment got to them late. Suddenly my interest skyrocketed and they charged me a late fee.
I called them, threatened to transfer my balance to another card and close the BOA account, and they apologized, credited back the late fee, and reset my interest rate to where it had been.
But it was a real sneaky thing to do, to change the due date which had remained essentially the same for the last 3 years, with no special notice.
@Hitchcock: This is a critical tactic that credit card companies due intentionally. They are banking on the fact that long-time cardholders who have always had the same due date (and probably auto pay via online banking), don’t scrutinize their bills and look for new dates. That way, they get the $39+ late fee. Often, they will move the date just one or two days to do so.
@WillScarlett and @maddypilar:
I believe that rejecting the charge does not mean canceling the card. The language in the letter isn’t clear, but this is a “term you may reject” which means if you catch the fine print you’re all good, as if no change happened, nothing to see here, move along. Cf. Chase’s change in terms a few months back. Other types of terms (I’m not exactly clear what) are not terms you may reject and if you reject them your card gets canceled. Ben&Meghann, maybe you can confirm this?
I got this notice too but have simply decided to cancel my card. It was a Linux Fund card, which was supposed to make money for some free software fund or something but I mostly had it because of the cute penguin. Linux Fund has since folded so this seems like a good time to get out, plus I have too many cards anyway.
I had a pretty exciting incident with the whole MBNA / BOA merger which led me to basically bludgeon my BOA banker into submission.
I would set up my payments for 8-12 months in advance, higher than the monthly minimum and generally about what I would use on the card. This way I keep the balance near zero, if I make a large purchase on it (to get additional protections, etc.) I would generally make a supplemental payment. The bottom line is that I am a space case, and if I don’t set the payments up in advance like that there’s fair to even odds that I’ll remember the day after my payment due date to make the payment.
Anyway, BOA buys MBNA (which had my Credit Card originally) I don’t use the card much, I don’t really open mail and I don’t check on-line well because I don’t use the card much. Final I am trying to use the card and it gets rejected. They swipe it again, declined. I get the CS rep on the phone, she informs me that my card has been suspended for non-payment.
I ask her to check that again, and she does, informing me that I have missed two consecutive payments. Rather than stand there and argue, I figure I’ll just use my other card and get it resolved when I get home.
I go home, I attempt to pull up my payment history on-line and am re-directed to a new website. I try and log-in per normal, but have to go through some set-up process. Fine, done. No problems. Then I get to my payment history, and there is nothing. Zero-zilch zip.
I get on the phone with the CSR and inform her that I don’t have a payment history available to me on the website and my statements aren’t showing any payments and now that I look at it my bank account isn’t showing any debits to MBNA recently. She then explains to me that when they merged, there was a change in the website used so that must be the problem. Well that does seem plausible, but how is it my problem? Why couldn’t they transfer over my scheduled payments? Well I have to set up a payment account on the new website. Okay, the payments were coming from a BofA account, wouldn’t that be a pretty close together set of dots for them to connect? She informs me that if I had logged in, I would have been re-directed to the new website and could have set up my payments there. T
his completely misses the point of fact that I schedule the payments that far in advance so that I have to interact with the site as little as possible. This goes on for a few minutes and I ask her to refund the late fees and put my interest rate back to less than terminal deadbeat levels. She informs me politely that it’s not possible, since I did miss two payments. I get it escalated, same story.
I finally have to go to my personal banker at BOA and threaten him with a complete removal of all my current business and all my future business save for a single checking account, that will have a couple of hundred bucks in it so that I can use their ATMs and branches when I’m traveling (they are almost everywhere). He gets on the phone, MBNA (now BOA) backs down and I’ve gotten my $78 + interest (@27% mind you) back. Unfortunately I’ve had to spend upwards of 3 hours plus one pretty confrontational trip to the bank to get it resolved. I’m still actually fairly pissed about the whole ordeal. I can’t understand why companies botch the acquisition of other companies so much. Especially in banking and cellualar where the whole point is to get customers.
I love complaint letters as much as the next guy (mainly because I’m writing them, not reading them), but the more I read letters posted on Consumerist, the more I realize why those letters get ignored so frequently: who’s going to take the time to read a really long, poorly written, hostile letter? All these bad, icky letters are clogging up the system for the rest of us!
A well-written complaint letter should:
1) Start with a compliment or kind words towards the company to show prior loyalty
2) Enter into a short, concise complaint in the second paragraph
3) Offer a potential solution and the reason why a solution would be worth the company’s time in the third (and final!) paragraph
What company is going to want to help out a customer who either isn’t going to appreciate the help or is going to stop working with the company anyway?
So, if I have a balance of $0.00 and I do not send in a payment of $0.00, am I charged a min finance charge of $1.50?
write to them at the address in the letter and state that you reject the proposed changes (only by mail and by may 1) and you don’t have to pay the new fees. Then transfer your balance somewhere else! I did. They suck. Yes, a balance of zero would still cost you $1.50. UNLESS you write the letter and tell them to go screw.
No, a balance of zero would not, by the terms stated in the agreement, cost you $1.50, monthly. Look at the second to last sentence under Minimum Finance Charge: “You may avoid a minimum finance charge by paying your new balance total in full each month.”
If you don’t carry a balance over, you aren’t going to be hit with it.
(I’m not defending it, just explaining what it states.)
@arelys521.
I’ve found from personal experience that bullets get the companies attention.
@RowdyRoddyPiper:
I’m sorry, but going in to a banking center and assaulting your personal banker is not the best way to handle the situation. Did you notice that the personal banker had to call the credit card department to take care of it while you sat there? Bankers inside the physical branch don’t have any access to your credit cards. The reason that you got it handled at this time is that most likely, your PB was a bit more polite than you were with whomever was unlucky enough to answer the phone. Also, how was the bank supposed to communicate with you about all of the steps of the merger? You don’t open your mail or check your statements online . . . were you expecting a personal phone call from the bank to notify you of all of the changes? Did you want us to hold your hand as well?
I’m really concerned that a lot of folks here are having some reading comprehension issues and really getting their blood pressure up over something that’s not a big deal. I got this same letter on an MBNA account I’ve had for over 10 years, with a $35,000 credit limit. No way I’m closing it.. But regardless..
NO, you will not be charged in months that you have a zero balance. What in the world has made anyone think this? Check out the words “More than zero.”
Here’s how this works..
If your finance charges (since you’ve paid off all charges in the allotted grace period and your balance subject to finance charge is zero) are $0, you will pay $0 in finance charges.
If you charged a ham sandwich at the deli and decided to wait 60 days to pay it off, and your finance charges were $0.43, you’ll pay $1.50 in finance charges.
If you bought a wicked sweet plasma for $6000 and paid only your $24 minimum payment on it or something – and your finance charges are $73, you’ll pay $73 in finance charges.
I understand there’s a lot of ire towards BOA (oh, and to the odd fella up there with his strange payment-in-advance scheme — not much sympathy for you, that’s just weird.) but this really doesn’t sound like a big deal.
Oh, I know, its the PRINCIPLE of the thing, but to really make it affect you any worse than a couple of dropped nickels, I think it’d have to be a pretty rare case. Can someone please explain to me how/when/where this could end up costing you that much, unless you decided to only make a partial payment on a $8 balance or something – which isn’t even possible?
On a second note – to the folks who complain about changing due dates.. Yeah, it’s shady, and it happened to me.. But guess what, you have to read your statements. C’mon, BoA may be evil, but you have to be a little responsible, too.
@Mr. Gunn:
Huh? I am not sure what you mean. I was simply stating that I am relatively happy with the deal that I have on this card. I am not happy about this change, and would be willing to switch to a different card, but only if it’s as good or better of a deal for me. I don’t have any specific loyalty to BoA; they have just offered me the best deal – what I described are the ACTUAL terms on my account currently. If anyone knows of a better deal, please let me know.
Has any ex-MBNA, new BofA, customer had the problem that when your account/routing number was being switched over that an automatic online payment didn’t go through, causing you to receive a late payment ding without knowing it until you realized that a payment was not made? If so, let me know, as we are looking for a representative for a class action. hvr@asmlawyers.com