My Personal Credit Card Revolt

I'm tired of the credit card companies. I'm taking my ball and going home.

I've had credit cards for about twenty years. The first credit card I had, the one I opened when I had zero credit history, had a 19.8% interest rate. Back then, I didn't realize how exorbitant that rate was. I was too giddy at the prospect of getting my first credit card. I quickly reached my credit limit, and spent the next couple of years with no available credit and no cash flow. It was a painful experience, but a lesson well learned.

About five years after opening that first account, I closed the account and spent the next couple of years paying off the debt. In fact, I was briefly debt-free about three years after closing that account. Eventually, I got to a point where I understood the need for revolving credit, and I got another credit card through my credit union, this time with a 12% interest rate. I tended to carry a balance on that card, but even in the worst of times, I only used about 75% of my credit limit.

Later on, I got a second card, with a 7.5% fixed interest rate. My plan was to migrate my debt from the old card to the new one by attrition. For the most part it's worked, but I still carry a small balance on the higher-interest card. Then the credit crunch hit.

Recently, I was notified that my rate on the low-interest card would be changed from a fixed rate to a variable rate. Okay, no problem -- for now, while the rates are low. 7.25 variable is still a TREMENDOUS interest rate. Then, I was notified that my higher rate card's rate would raise from 12% to 15%. I was angry at this, but accepted it.

The higher-rate debt was recently sold to a new card company. I got the full agreement in the mail yesterday. Here's the gist. The LOWEST rate that I would be charged, based on the new agreement, is 15%. That, in itself, sucked, but I was willing to live with it for now. What got me, you ask? Well, I kept reading the fine print. Get this... there is NO MAXIMUM on the rate that they could charge me. In other words, when the prime rate raises to ten percent (and it will, mark my words) my interest rate would be something like 25%.

I've been a responsible credit card holder for about twenty years. I say "responsible" because I was not late in my payments, and I never defaulted on my agreements, even when I was young and reckless. Did I tap all of my available credit? Sure. Did I default? Never. And for the last ten-plus years, I've been a creditor's wet dream. I tended to carry a balance on my cards, but I never maxed out my available credit, and I always paid more than the minimum required.

And what's my reward? Well, based on my higher-rate card, my interest rate has been lowered, on average, one-fifth of a percent per year of responsible credit experience, and then they have the balls to tell me that my interest rate could, theoretically, be higher than it was when I had no credit at all!

I'm done with these clowns. I called the new credit company today and told them that I don't agree to their terms. They have closed the account, and my plan is to pay it off in approximately 12 months. This payment plan will allow me to free up cash flow for the medium and long term, will eliminate the crazy interest rate, and will not be unbearably painful in the short-term.

By the way, I know that this will have a negative effect on my credit rating in the short term. It will reduce my available credit, which reduces my credit score. Fortunately for me, I do all of my financing through my credit union, who knows my payment history. Furthermore, this is my personal way of saying that I am not going to continue playing the big banks' game by their rules. These bastards got billions of our tax dollars in bailout money, and they STILL have the audacity to jack up our rates?!? They're getting us on both ends. I, for one, am sick of it! Since the politicians won't do anything about it, I guess that my only recourse is to take matters into my own hands, to the extent that I'm able.

Consider this my personal invitation to join me in the credit card revolt. While I do not specifically condone this approach to the credit revolt, I believe that it's time that we, the consumer, should take back our power over the banking system.