Creditors Have Increased My Interest So Much I Can No Longer Afford to Make Pymt

I think there is an Federal agency that is monitoring this type of activity by the banks to which you can report the creditor. Or, the White House now has a place where you can email complaints about banks and these types of behaviors. If you can't find this on the Fed Gov pages, call "Call 3". I think I first heard about the monitoring group from a story on channel 3 which said there was a watchdog group watching the actions of banks since they received all the stimulus money. Call 3 KCRA was the station where the story broke. They might know.

Hi, K.. How awful! You are the second person I have heard of with this problem. Try Consumer Credit Counseling Services. Offices are nationwide. Here is a link for a few in the East Bay Area: http://www.cccsebay.org/Locations/index.asp. And here is the link for the one in SF: https://www.cccssf.org/

best wishes!
Siddheshwari/Meg

“I am guilty of never looking at my statement”

“The bank decided to raise my interest”

“I just stopped paying” “I just threw my hands up”

“My girls need new cloths”

“My oldest child’s father cheated on me”

“I trust my girls”

Dear K.,

Since you can trust your girls, let them know that you can’t afford a lot of new things -- if any and take an adventure to your local second hand stores. Some of the stores have brand new things (tags still on) at very low prices.

You missed a payment (late pay) on your new refrigerator. I wonder if you called them and explained you would be paying late and would they be willing to waive any late fees based on the fact that his had not happened in the past?

Looking at your history (in your “own words”), you are repeating the same behaviors in every area of your life, making yourself the “victim”

If you want to clean things up, be straight forward with each of your creditors, you do not need onc of those consolidation agencies to do this.

Create a form letter of (cease and desist) and simply be honest about your present financial situation. (i.e. single mom, limited income, what your expenses are and what you are able to do. Ask your creditors if they would be willing to reduce the payment, waive late fees, interest etc.) Once you've done this, they can legally, only contact you one more time.

Here is an example of a cease and desist letter:

Debt Collector’s Name
Address
City, State Zip

Re: Account Number

Dear Debt Collector:
Pursuant to my rights under federal debt collection laws, I am requesting that you cease and desist communication with me, as well as my family and friends, in relation to this and all other alleged debts you claim I owe.
You are hereby notified that if you do not comply with this request, I will immediately file a complaint with the Federal Trade Commission and the [your state here] Attorney General’s office. Civil and criminal claims will be pursued.
Sincerely,

Your Name

You might consider bankruptcy (you can also do this yourself,forms are online or available at the court recorders in your area).

Most of all, give yourself a clean slate and don’t let anyone or anything make you feel like a victim again.

Blessings…….

Hi K.-
Here's the deal- I found this out and it pissed me off to no end. In super tiny print, it says if you keep your credit card account open, the finance charges were going through the roof. I have fantastic credit and am like you, not using my cards ever. But the fact that they were open gave Visa and MC the leverage they needed to jack up the rates. What is terrible is that I had rates between 7 & 11 percent, and they were raising them to 25-30%. I got my notices in April and May of this year. My husband and I have also decided to go 100% credit card free. We went and saw a credit counselor and had them work up a budget for us. The key is sticking to your budget- it CAN BE DONE!
As for the cards, the only way to stop the charges, etc., is to close the account. YOu can do this while you still owe money. I owe Bank of America thousands, but my credit card account for all intents and purposes is closed. Once closed, or permanently frozen, you can make payments at the agreed upon interest rate. I still have to call to make sure the rate doesn't go up, because they can be pretty sneaky.
So call your creditors at Home Depot and close the account. Talk to them and accept nothing over 15.99% interest if they want you to pay your bill. If not, tell them you are going to declare bankruptcy. After that much time, they won't be able to get their appliances back and you won't have to pay them their money. DO NOT let them bully you or threaten you. If they even attempt to, ask for someone above them and refuse to speak to that agent. Then begin with the management or "escalation" agent and let them know you do not appreciate the tactics and will not accept being spoken to that way. Trust me- they all do it- and all the management denies it- either way, they have a choice- work with you and they get paid or not work with you and not get paid. It's pretty simple. But you have to be proactive and you have to be a tiger. Sweet, but a tiger!
Lastly, as far as not being able to pay them off, call Consumer Credit Counseling. They can work with your creditors, get your interest rates down, and help you budget your payments within your means. They are amazing, and it helps to rebuild your credit and put you back on track. Don't let the phone calls and the creditors harass you. The people calling actually have NO power whatsoever, and cannot do a thing to you as long as you are making attempts to do something. They have no real leverage, but are trying to scare you. They just don't understand that when someone literally has no money, they literally can't pay until they do. MOney does not grow on trees and appear out of thin air.
I want to encourage you- call a credit counselor, get your stuff in order, and then slowly but surely pay off your bills. Also, call and freeze/close all of your accounts right away. The credit counselor can do this with you. The $20 fee is 100% worth it to get this straightened out. ANd if you can, I would live credit card free and try to stick to really simple budget. It may be tight for a while, but in the end, totally worth it , and your girls will see the benefits of good money management. This only way to stop those rates, I swear by it. We are doing the same thing and I will never go back. If it isn't a personal fixed loan, I won't even consider it, now. Just because of what they tried to do to me and are doing to you.
I hope this helps! Good luck!
-E. M

Transfer the balances to a card with a reasonable rate and then start paying attention to your finances. You shouldn't be not looking at your statements and you definitely should not ignore them and not pay them. Being mad and ignoring the bills is not a reasonable response to your situation. Transfer the balances before your credit is completely screwed and you have no other options than bankruptcy, which apparently isn't easy to get anymore.

And to second one suggestion below -- Citicard seems to be the easiest to get - I would try them. You may not be able to start with 0% if your credit isn't great, but you should get something lower than what you currently have.

Pay more than the minimum due on your cards, or you will be paying for years, and will add hundreds or thousands of dollars in interest to your bills. I bought my refrigerator at Sears at 0% for a year, and paid it off within that year, so I never paid any interest.

Your kids will not be harmed in any way by not having new clothes. I doubt I spend more than $250 per year for clothing on each of my kids, and I don't necessarily do it right at the beginning of the school year. I buy my kids clothes only when they really need them. Old Navy always has sales and their clothes are really cheap. It's a great place to get kids' clothing. Your kids WILL be harmed, however, by growing up with expectations that they are entitled to this or that.

If you start managing your cards correctly, you can actually MAKE money on your credit cards. I pay my cards off every month, and get cash back, so I make over $1000 a year in free money on my cards and never pay interest. Any balances I have on cards are on 0% cards.

Hi K.,

I feel your pain. I got into debt with credit cards when I was a teenager (only about $5,000.00 but it was still alot to me at the time)and I was lucky enough to have parents that were willing to bail me out. They gave me the money to pay my cards off and then I had to pay my parents back with no interest. That SHOULD have taught me a lesson, but I hate to say that it didn't. It worked for awhile as I stopped using my cards... but then one day, I needed food and didn't have any money... so I charged it. That opened me up to using my cards again and I again got into debt by charging things. I couldn't make the payments on time which caused my APR to go sky high and then I REALLY couldn't make the payments at all. I called the credit card companies to see if I could set up some type of payment plan and to lower my % rate, but they would not budge. When I got together with my husband (at the time boyfriend) he was in the process of paying off his bills via credit card consolidation. I had heard of that but was always told NOT to do it and that most were scams. Anyways, my husband had a great experiance with the company he went though. While he was paying through the company, his credit was pretty low... but once the cards were paid off, his credit jumped WAY UP and there were no permanent scars on his credit from going through the company. After seeing what it did for him, I decided to do the same. My monthly bills totaled $500+ per month and the company consolidated my bills and made my payment $191 per month... MUCH MORE AFFORDABLE!! I am still going though the company but I've paid off 3 cards so far and only have 3 more to go... I'm so excited to see them slowly going away... =) We've closed our credit card accounts so that we won't get into trouble using them again and we pay for things in cash. If we can't afford it then we safe up until we can. It works for us. If you'd like to know more about consolidating your bills, send me a message and I'll tell you more about how it works... amount that goes towards the cards, amount that goes to the company(fee is $14 per month), etc, etc... in my opinion it was my best option and I am happy I did it!!!
Good Luck.

If your kids' clothes still fit, and are in decent shape, don't buy new ones. We didn't get any new clothes for our three kids, and they seriously don't even care (Well, the teen wants new ones, but he also wants violin lessons and a trip to Italy! He's a dreamer.)
If her clothes are too small, that's different, but you can get inexpensive ones, as others have suggested.

Hi K.,
Here is what worked for us. Typically, before they raise your interest, they have to notify you. Your choices are to accept the higher interest rate, or reject the higher interest rate BUT you can't use the card anymore. I would call them and say, "Look, either you can lower my interest rate back to what it was and take off all these fees you've charged, or I'll be forced to declare bankruptcy. You can tell that I can't make the minimum payment with this high interest rate you're charging, and I would rather continue to pay on my balances than to declare bankruptcy, but you're not giving me much choice." Be specific about what interest rate you would like the card lowered to. If it was 10% interest before, then tell them you want it to be 10% interest now. Stick to your guns. If you're late on your payments, that will actually help you make your case, believe it or not. Ask to speak to a supervisor if the front-line people won't help you. Keep at it until you get the response you want. If they won't help, talk to a credit counseling agency (like creditcounseling.org) about other options you might have.

Going forward, make it a priority to pay in cash so you don't dig yourself any deeper into debt.

All that said, I think you would be surprised what kids can do without, without noticing or caring! My husband and I were teetering on the brink of bankruptcy about a year and a half ago because my husband had lost his job, and we actually did lose our house. We went on a "credit diet" and from that moment on, we have charged absolutely nothing on credit cards. I shop in consignment stores for myself and my kids, and you would be surprised at some of the nice things you can find there! Sometimes these clothes still have the store tags on them! When my kids ask for things, I ask them, "Do you have the money to buy this? No? Well, either do I!" and we laugh about it. Unless your kids are wearing rags, they probably don't need new clothes. Prioritize the credit card bills, car registration, etc first, pay for what you can in cash, and find other ways, even if they are temporary, to lower your monthly bills. For a while we lived without cable and my husband had to give up playing sports. We cancelled our gym membership and I even rode my bike to work to save on gas money. I buy store brands rather than name brands. We don't eat meals out. The good news is, we've been able to dig out from under several bills and we are slowly adding cable, gym, etc back into the mix. You can do it! Hang in there!

Call your credit cards and ask for lower rates! Store cards won't but a lot of regular ones will. I'm at 6% w Wells Fargo right now. Negotiate on everything! Due date, min payment etc...
Shop around for better rates and 0% balance
transfers. Credit unions often have great rates so look into that.

Good luck!
-C.

K., many people have gone through this situation, our household has been affected as well. I have read somewhere that new laws were passed that banks are not allowed to do that above a certain point and take advantage of consumers in the bad economy times. (Check it out here
http://www.suburbandollar.com/2009/09/02/credit-card-laws/ )
pay attention to number 3, in this article. it says that banks have to forewarn you about the increasing rate, and that you have an option to refuse, in which case, your card will become inactive after you pay the premium off.
You should not give up, and definitely should not drop payments, you should argue, debate and request hardship accommodation. Now, if your credit history is affected it would be harder for your for e.g. to transfer the balance. But don't despair, just keep looking for solutions and fighting.

HI K.,
Credit card companies will do some nasty things in my opinion. If consumers start boycotting those companies than I believe we will ultimately start having more power. I recommend reading or listening to Dave Ramsey's Total Money Makeover (he also has a radio show that you can stream). I don't agree with everything he says, but my husband and I are doing his plan and it has completely changed our lives. We saved up an emergency fund, cut up our credit cards (except for one initially) and started paying off debt. Recently, the card I hadn't cut up tried to charge me a late penalty and up my interest by 10%. I called them and was able to get them to reverse the charges. But if they hadn't agreed to this, I would have transferred my remaining balance somewhere else. This gave me power! I cut up this last credit card. In less than a year and a half, we have paid $19,000 off our debt while I had a baby and cut my work to half-time. We do not have to be slaves to the credit card!

K.,
While times are difficult and finding a way to get through sometimes seems impossible, you should reach out for help. Call consumer credit counselors. There are many that will help for free and they can negotiate your interest down and work on a repayment plan. You don't want to ruin your credit because the banks have the upper hand. You will need good credit if you want to help your kids get to college or anything, so hang in there and get some assistance.
Good luck, but don't give up!

www.cccssf.org. Go to their website. Can offer you various options at least read about them, and understand the process. Wether it be consolidating your debt. Calling your creditors directly maybe they can place you on a hardship program. Or as your last option bankruptcy. I know you mentioned you cared about your credit score, but I assume that since you are already behind your score has dropped. At this point you have to think about your priorities, which sounds like your kids are. You balance your options out.

God bless and good lucK!

Well, if you don't need to buy a car or a house in the next 7 years, (probably more like 9) you can completely ignore them and never ever pay them. They will hassle you. They may be able to take your fridge, or repossess other items, I'm not sure exactly how they work, and how much you have charged on them. My husband let some cards go when he was younger. It really does butcher your credit, but you may not have to actually pay it. The collections people might make your life hell, though. I recommend calling the companies and discussing this with them. Tell them that you can't make the payments and that the interest is too high. Tell them that if they do not lower your interest rate that you will stop making payments, as you do not care about your credit score anymore anyways.

You can ignore your debts, but I would get a new phone number in someone else's name, like your mother. Also invest in a paper shredder and prepare to get a lot of mail.
These people want to get paid, so they may work something out with you.

Good luck
and remember, they (the credit card companies) can't take your daughters away.

Hi K.,
I didn't have time to read the other responses yet, but I listen to Clark Howard a little almost every day and he has been talking about how the credit card companies are punishing the good guys a lot now..... I'm sorry that includes you. He did mention yesterday to someone that had this same issue about a 'hardship' that you can ask your card company about. If they can, they can decrease your interest to 0% under the hardship clause, so that you can continue to pay. The only reason the companies will do this is b/c so many people (like you) are just stopping payments and will end up foreclosing on the accounts.... meaning they get no money at all. Check with your accounts and then that may save your credit and save your interest. Good luck and so sorry about that situation!

Join the rest of us. The United States is a mess and no relief is in sight. What you can do is call the companies, ask for the supervisor and try to get the interest reduced back down to what it was after you explain your situation. Some companies will do it, some won't but don't let this go on too long or they'll take your whole paycheck, I know, it happened to me and I had three girls to feed at the time. We both lost our jobs and had to go on welfare until the bills were paid off. What a mess. Good luck. Oh, this was over twenty years ago or hopefully things have changed. Call them. Some companies will work with you.

i know how you are feeling i have recently posted something about debt conslidation that might benifit you to go back and look at all the responses that i got. i decided to do the debt consolidation i checked with the BBB and did some resarch and ended up using Money Management International. they look at all your credit look at your current spending habit and give you suggestions on where you might be able to cut some spending increase your savings and also tell you what options is best for you either debt consolidation, handling your credit your slef and give you tips on how to call and talk to the creditor, consumer credit counsling or bankruptcy. they really go through every option with you tell you the pros and cons of each in your individual situation. we are doing the debt consolidation i only pay a monthly fee of 35 but i am still paying less that i was paying the min. and they have a web site to log onto and see how they are distributing the full payment amount. i still get my monthly statments from my credit card companies and if the credit card company does not apply my full payment that MMI submitted to them they will go back and correct it i just have to notify MMI and they take care of everything for me. it is working out great so far. good luck with this it will all work out now that you are looking for a means!

I had a similar problem with my Lowe's card. The interest went up to 31.25% so I called and asked them to lower the rate and they refused. I ended up doing a 0% interest balance transfer to a Citibank card. The 0% interest only lasts for nine months since it is a promotion but then the rate goes to 11%. I got the 0% offer in the mail, maybe you'll get one of those too or you could check out the cards/rates at www.citicards.com. I hope this helps you!

K.,
You might want to consider bankruptcy. I hated doing it, but we had to since I have lost half my pay. The creditors will not stop calling until you pay. After six months they can write it off, but will still keep calling and sending letters because they want their money. It will always be on the credit report also.
W. M.

Try a credit counseling to lower interest rates and make an affordable plan. Credit Counseling Company CCC is a nonprofit I think. I used them when I was in college with almost $12000 in debt. I wanted to buy a house so I worked 2 jobs made payments, saved money and three years later was debt free and bought my house by my 26th birthday. Don't give up! Your family is your rock and the motivation to keep going.

There are many articles on how to keep good credit. Some of the articles mention talking to the credit card companies to make arrangements for lower rates. Tell them that you always pay on time and don't miss a payment. (You may have to show them your cancelled checks). With this information, the credit card company needs to take this into consideration.
You might, also, want to see if other companies will give you a lower rate. You have to pay something on your credit card every month, so you will have better credit.

Another road to take is to go to a credit consolidation company (a reputable one) to help you with your debt.
In the magazine Money 2009, there are many ways to help you save money. It mentioned what you could do to lower your credit card balances.
With identity theft on the rise, it is very important to check your credit card bills.

I certainly understand what you are saying because I am going through the same thing. Always paid on time, always paid over the amount and some of mine are doing this to me. I am opting out of one of them this month because they are raising the APR again to some ungodly amount that I cannot afford. It's not right but they have the upper hand.

Unfortunately it does no good to call them. There are agencies that will help you resolve your credit problems; however, there are a lot of scam companies out there too. Bankruptcy is always an option and then just pay by cash but it affects your credit for 10 years. At my age, it is an option... however, you might need to think about it.

This happened to me about a month ago... My interest rate jumped up to 28%!! and I have no idea why....So I called and said I cant afford this high of a payment..it had doubled! and right now I think most places are pretty understanding with the economy and they agreed to lower my rate to 8% as long as I didnt use the card anymore..and I have used the card since then and luckily they didnt raise it agian..
Then with another card they rasied the rate and when I called they said there was nothing they can do...and my co-worker told me if you just throw the word bankruptcy in their they get scared and would perfer to lower your rates and work with you vs. you doing bankruptcy..So I called back and said if I cant get my payment reduced Im considering having to declare bankruptcy..I am calling all my cards letting them know this....

And by that being said they worked out my payment to much lower and interest rate although they did put the account on a freeze so Im not able to use the card
Good luck Just call them and they will hopefully work with you