Sophie did what any good Consumerist struggling with credit card debt would do. She called up her lender, American Express, and asked if they would be able to help her with some kind of payment plan before she missed any payments. knows that some credit card companies are currently happy to negotiate when struggling customers call them up, since a customer making lower payments is better than a customer missing payments, or not making any payments at all. Right?
I recently had the great pleasure of dealing with American Express’ Payment Plan department. Let me admit first that I am terribly in debt. I have been living beyond my means. HOWEVER, I should say that I have NEVER missed a payment on ANY of my accounts whether credit, store, education loans or otherwise; my accounts have always been in good standing. However, like many people, my financial bubble burst as well, and it came to a point where I realized I was going to start missing payments if I did not negotiate some sort of payment plan with my lenders.
Being the novice that I am, I simply thought that you could call a creditor, tell them you were happy to cancel your account, and then they would help you set up a payment plan. In my mind, that would be better for everybody than missing payments or not paying your bills for over 60 days, right? WRONG. As I have come to learn, nobody wants to do a thing for you until you are not only in debt but royally screwed. But even better than this realization was the fantastic conversation I had with a customer service rep at Amex. In hindsight, a tape recorder would have been handy. I called, preemptively (as in, before I started missing my payments on purpose), and asked if they could help.
The initial response: “no”. Well, I said, I’m experiencing financial hardship because I’m not earning enough at my current job. Then we do a financial analysis: she asks me how much I make, what my bills are like, et cetera. Then she says that it looks like I am upside down at least $400 for the coming month. Curious, I point out, how that was around the same amount that I was attempting to negotiate down from paying on a monthly basis to Amex. Well, she continues to say, I can’t help you because you don’t have enough money to cover your bills. Strange, I say, because that’s why I was calling you (and my two other credit card companies).
We went around in circles like this for about 5 minutes. At that point, I started to become a little frustrated. Okay, she says, I can put you on $250 in payments, lower the interest to 0% for the first 6 months and 9.99% for 6 months after that. Wow, I say, that would be great, the only problem is $250 is what I pay NOW and I can’t afford it, could we make the payments perhaps a little lower. No, she says, that’s the minimum (I learned later that it’s not).
I started to get a little emotional. I told her that I didn’t understand why I had to become delinquent on my account for them to offer me a better payment plan but since I realized this is what I must do, so be it. She then flew into a rage stating:
-This is YOUR fault that you are in this situation
-How DARE you ask American Express to shoulder your responsibilities
-Maybe if you didn’t spend money you didn’t have you wouldn’t be in this situation to begin with
-This is AMERICAN EXPRESS’ MONEY YOU’RE ASKING FOR*Ahem* Thanks mom. I told her it was unprofessional to speak to me in such a way, blah blah blah and hung up the phone. Flash forward to three months later of me NOT paying them, and lo and behold that “$250 minimum” doesn’t exist anymore.
I find it fascinating that somehow me asking a company I’ve been overpaying since 2005 for help is so daring and irresponsible. Furthermore, is it not true that anything they make on top of what I’m actually paying them back for borrowing is simply profit??!
Anyway, that’s my story. I am in the process of approaching Citibank and Bank of America for the same thing but, again, I’m either told “You’re in between billing cycles so I can’t help you” or “You’re current on all your payments, what’s the problem?”. The problem is I’m paying an unnecessary 29.99% interest rate on both those cards which means that even if I pay $50 over my minimum the balance doesn’t shift because of finance charges. So, at the beginning of every billing cycle I’m effectively back where I started. I know it’s my fault I’m in this mess but a little help in good faith would be nice considering I’ve always been a very good customer.
But I suppose that’s not what matters anymore.
No, foresight and planning ahead financially are not valued traits in credit card land.
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I hope she doesn’t owe the IRS anything – they’ll make her cry on purpose
I had the same problem with Chase. We were a double-income household until I lost my job. We were then spending more on CC debt than we were earning per month.
Discover, Chase, and BoA refused to discuss payment plans because… get this… our total debts exceeded our income, and we had not missed a payment yet. All three informed us we would have to miss at least 3 payments before we could make a deal. I had to lie about our expenses before they would come down, and even then it wouldn’t help enough to keep us afloat.
I switched tactics and said I’d not pay anything then, as I’d rather feed my family than pay exorbitant rates. Chase said they’d take me to court, and then backed down after I pointed out it could drag out for more than 4 years with what I knew, and then the statute of limitations would kick in.
They all caved after that, and our payments went from over 2k/m to 800/m. We no longer have cards with any of them (which is good), and our scores are not affected as we’re still paying everything correctly.
there is no remorse in this story. simply admitting that she lived beyond her means does not mean she deserves a cookie. further, after getting a solid offer from amex, something they did not need to do, she admits she was the first to get “a little emotional,” which if admitted by her, was probably worse than just a “bit.” fact is amex owes her nothing and in fact, she owes them. that she has to take the same route with two more cards shows that she fully deserved what she got, whether unprofessional by the representative.
this is a horrible story and should be filed under the negative examples of consumers. people who don’t think and then look for hand-outs. amex did nothing wrong here other than have one rep become slightly unprofessional, but that’s not even something we can say with absolute certainty as we don’t know how this person became “a little emotional” after receiving an offer.
“flew into a rage” is slightly unprofessional, and apparently, understandable to you – but someone who can’t afford their payment being offered a lower interest rate and the exact same payment (which they still cannot afford) is no cause to get emotional. Ah.
4 words…
Dave Ramsey Debt Snowball
Google it.
I had a fun one with AMX. Back During the great recession I actually made a bounce at X-Mas. I took the bonus figuring I would be responsible and paid off my AMX blue card. They promptly cancelled the card on me the same month. Thanks AMX
So, this is my post. (Imagine my surprise actually seeing it on this website I read daily!).
Here’s an update on my situation (for those interested):
1. I am now in the CARE plan with Amex paying $180.00 per month for 12 months (6 months with 0% interest, 6 months with 9.99% interest; account cancelled). I upped it to $200 recently (the most I can afford) to at least get the most out of the 0% interest months. I’m going to see what I can do to make that a much more significant number in the next few months
2. I never defaulted on Citi or BofA. I was actually able to negotiate a much lower interest rate on Citi (and they seemed surprised that it was that high to begin with). And BofA is at a fair interest rate at this time. Both accounts are in good standing and I have been making above minimum payments consistently
I went through and read everybody’s comments. Thanks for the support and thanks even to people who think I’m a wacko clotheshorse who’s been living off the Bank of Dad in an alternate reality from the rest of humankind only to be awakened (rudely!) by the melodic voice of an Amex CSR. I could not even begin to explain what motivates Amex to give a 23 year old close to a 15K credit limit at roughly 18%….(seriously, although to be fair this was back in 2007, but still I was 23…with a job at a non-profit…in Harlem!).
In even more awesome news, I’ve been able to put my student loans into forbearance (a PhD = just about the most useless thing money can buy, esp. if it’s not in business/science/et al.) so I’m using the (little) excess to help pay down all my CCs (which have substantially higher interest rates compared with the student loans). I share a 1 bedroom apartment, I drive a used car I bought from a rental car place (for under 10K financed), I switched to a cheaper car insurance provider, I walk every weekend, eat at home as often as possible, cancelled cable, and bought a book on how to make a perfect Old Fashioned at home!
Listen, I’m not perfect (as if that needed clarifying), I’m doing the best I can for the moment and I am working towards being even better.
Yeah, I don’t disagree that credit card companies need a Fight Club-esque wake-up call (everyone back to zero)
But this is exactly why at 23 Renting an apartment leasing a new car and having a nice cell-phone and my own insurance, I still don’t have an open credit card. I have them, but I don’t use them. There’s a reason for that. There’s also a reason when the credit card company said “you have such good credit and make so much a year we can offer you a spending limit of 50,000″ I said “what’s the lowest amount, whatever that is that’s what I want”. Because the lowest amount on my Platinum Awesome Rewards card or whatever it is, is 5k.
Who needs that much money at a time? Emergencies only. If you don’t have the money NOW you won’t have it when you need it. Credit is a necessary evil, but unfortunately should only be used to further your good credit, not to spend when you have nothing to back it up.
Not trying to slap you in the face, that sucks that so many people get sucked in to them. Good luck to you!
Boo hoo. Maybe this’ll learn you to live WITHIN your means from now on.
I have two AmEx cards, one is the AmEx Gold and the other issued by Costco. For the past 2 months, I’ve made a payment for the Costco AmEx. However, on the same day my AmEx Gold shows a payment for the minimum amount which I didn’t make. One data point isn’t a trend but two consectuvie months with the same things happening?!?!
In their outsourced call center, the representative pleads ignorance and transfers me to another location. The representative in AmEx Customer Service in Plantation, FL, listened patiently when I explained the issue again but said that AmEx still needs 3 business days to check out the ‘problem’. Let’s see, I call on a Saturday, the day after I authoized only 1 payment, but the’re no one available to ‘check out’ the problem. Guess those individuals who ‘check out’ the problem have different business days when it comes to this global company managing my money. Oh, I’ve already disputed the AmEx Gold payment with my bank. Anyone else had this happen?
J T