Credit Card Rates Up, Benefits Down

Parchayi and me both have credit scores in the 800s, always pay all bills on time etc. and in spite of that we have been seeing notices from credit card companies every few months increasing rates and reducing benefits. It seems we are not alone and banks are just jerks who will do as they please before Obamas new Credit Card Act goes into effect in 2010. Have you noticed your rates go up too?

Also the credit card offers have completely dried up. In the last year I have also seen credit card companies canceling cards that I don’t use very often.

Amongst the cards that have slashed benefits is HSBC Cashback Platinum Mastercard. I had a card that had increasing benefits the more you use the card. It was 1% cash back upto 2500$ spending. Then 2% from $2500 – $5000. And 5% for all spending over $5000 in a year. Now it is just 1% no matter what. Also this was the card we used the most.

Amongst the cards that increased rates is Citibank Dividend Platinum Mastercard. They raised from 12.99 to 19.99% and that too after we started using the card more often since HSBC cut the cashback!

Amongst the cards that I had canceled is Washington Mutual Visa Platinum. The only reason I had the card was so I could get my credit score free each month. So I can’t complain about that one being cut. The bank got nothing from me.

Wac(hovia + Citi – Citi) + Wells Fargo

This mornings news is that Wachovia is now being merged with Wells Fargo for an approximate price of 7$ in an all stock swap where each shreholder gets about 0.19 share of Wells Fargo in exchange for each share of Wachovia.

Here is what I think is happening. How do you get someone to accept a bad deal? By presenting another option that is so bad that the bad deal looks good. In this case the other really really bad option was the Wachovia-Citi-Fed deal and that was presented to us so that we accept this other bad deal by Wells Fargo. I say Wachovia shouldn’t settle for anything less than 10$