Why Can Capital One Raise My Rates Just Because The Economy Is Bad?

We’ve been getting a lot of shocked letters from Capital One customers asking how the company can get away with raising their interest rates on their cards when they “haven’t even been late with a payment.” There is, in fact, no such thing as a fixed rate card and credit card companies don’t need a “reason” to raise your rates. They can do it whenever they like.

Reader Chris got a letter explaining that his rate was going from 9% to 29% because of the difficult economy. He wants to know if there’s anything he can do about this.

I’ve googled and found hundreds of other people are posting about receiving the same letters from Capital One as well all with varying rate increases. Some people, if they are to be believed, have had cards for 10+ years and have never been late.

Didn’t Capital One get money from the government? How can they turn around and say they’re raising rates now because of the bad economy if they got a bailout?

Add to that the fact that I don’t want to cancel the card because I don’t have any credit now as it is considering, for years, I paid for everything entirely with cash/debit. Now, in an effort to raise my credit, I’ve been using the card for everything and paying the balance off each month, so I’m not actually paying any interest, but if I can’t pay in full for any reason I’m going to get screwed along with everyone else.

Is there any recourse?

Nope. There is not. Terms can be changed at any time. All the credit card company is required to do is give you 15 days notice, which they clearly have done. The only thing you can do is close your account and pay off the balance.

Answers About Changes to Credit Card Terms and Other Forms of Credit [Office of the Comptroller of the Currency]