If you never signed up for electronic statements and ended up missing payments because of the switch, you may have grounds to reverse the credit damage
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Dear Your Business Credit,
I have had a business credit card for almost 10 years and never missed or been late on a payment. Somehow my paper statements got switched to email, and I really do not remember making the switch.
About the same time the paper statements stopped, I changed my email account. For two months I did not receive any bill from the card issuer. I know it is my responsibility to keep up with the bills I owe and somehow I dropped the ball on this account. By the time the card issuer contacted me by phone, they had raised my interest rate from 9.9 percent to 29.24 percent and lowered my line of credit from $25,000 to the amount owed, which is just over $6,000.
I immediately brought my account current and for the past three months have paid on time and over the minimum amount due. Every month I call to have my interest rate lowered and every month they tell me no. Today I was advised I would need to make payments on time for the next 12 months and at that time they would consider lowering the interest rate. They refuse to look at my nine years of excellent payment history and only look at the past 12 months, with the two months of no payment. They have already reported to all three credit bureaus. I have not used the card since this occurred.
Is there anything I can do to make them lower the interest rate? Lowering of the credit line was a huge hit, but I would never make a purchase on an account with such a high interest rate. Any suggestions you can offer would be greatly appreciated. Thank you for your time. I look forward to your response. — Julie
I’m sorry to hear about your frustrating situation. Don’t give up. This is a case where persistence should pay off.
To get some advice on your options, I turned to Robert F. Brennan, an attorney in La Crescenta, Calif., near Los Angeles, who specializes in wrongful credit damage and Fair Credit Reporting Act (FCRA) cases, as well as identity theft cases.
When I mentioned to him that you do not remember your paper statements being switched to email, he suggested that you try to determine what actually did happen. Look back through your records and any correspondence from the card issuer. Did you give your express permission for the issuer to start sending the bills by email? When you called the card issuer, did the account representative refer to a specific action you took, such as checking off a box on your statement that authorized the switch?
If you did not give permission, it is possible the mistake was caused by the bank. In that case, he says, you have the option to notify the bank and the credit bureaus — and you may want to challenge the information reported by the bank. Under the FCRA, you are entitled to dispute incomplete or inaccurate credit information with a credit bureau. Once you do that, the bureau must investigate and remove or correct information that is incomplete, not verified or unverifiable.
You may also want to file a complaint with the Conssumer Financial Protection Bureau. It will submit the complaint to the credit card issuer, give you a tracking number and report back to you on the company’s response.What if you did consent somehow to the e-statements? Brennan suggests calling the card issuer and asking to speak to a supervisor. “Try to get someone with as much authority as possible,” he says. Reiterate your strong history with the bank and see if the supervisor will help you.
It’s good that you’re going beyond the minimum payment every month. Given the high interest rate, I would suggest paying down the balance on this card as soon as you can. Since this is a business card, I’m going to assume you run a business. Perhaps you can reduce other business expenses by opting for cheaper office supplies, switching telecom providers or taking some other relatively painless step to free more money for card payments. Another alternative is to look for a second business or part-time job that would generate enough cash to clear the debt.
Depending on your credit score, you may want to consider doing a balance transfer to another card with lower interest, either now or a few months from now when you’ve had more opportunity to build your credit score back up. CreditCards.com publishes a list of balance transfer cards, which are designed to help people consolidate their debts into one card. Most start out with a 0 percent APR. Given the high interest rate you are now paying, this can save you a lot of money.
The trick with using a balance transfer is to pay off as much of the balance as you can during the period when there is a 0 percent APR. After the introductory period, the interest rates increase, sometimes pretty dramatically. On the American Express Blue Cash Everyday Card, for instance, your APR could rise as high as 21.99 percent, variable, after the honeymoon ends. On the Citi ThankYou Preferred Card, the top rate is 22.99 percent, variable.
Your letter is a good reminder to all of us that when signing or updating any agreements with credit card issuers, it is important to keep copies or, if you update information online, to take a screen shot for your records. If you open a new card to do a balance transfer, keep that in mind. It’s a lot easier to defend yourself in this type of situation if you have good documentation. Meanwhile, the good news is that as business debts go, yours is relatively modest, so if you are disciplined, you should be able to tackle it one way or another without having to live with it for years.