Monday, October 26, 2009

Ok - So It Took an Outrage

Again I find myself apologizing to both of my faithful readers, life continues to be very, very full and sadly blogging fell down the priority list. I promise that when I get settled into my apartment in Japan (yes, I spend that much time there) I will have more time to blog.

Anyway, the thing that prompted me was this.

Loraine Mullen-Kress carries a Bank of America credit card and religiously pays off her balance.

"Flawless credit," she boasted.

Yet now, her good credit habits could cost her. Earlier this month Bank of America started notifying customers like Mullen-Kress that they will be charged a new annual fee of $29 to $99.

"There is a big segment of their population that they will have never made money on, which is people who pay their bills on time every month," said Ben Woolsey, Director of Consumer Research at

Bank of America said in a statement: "At this point we're testing the fee on a very small number of accounts and haven't made any final decisions." Citigroup is also trying out an annual fee with some card holders, and analysts expect more banks to follow their lead.

The banks are starting to charge fees to reliable customers in response to a slew of new credit card industry regulations that will limit when banks can hike interest rates. Cardholders who get a new annual fee notice in the mail will be in a no-win situation.

"They can either pay that fee or they can close the account, and if they have had the account for a while and they close it, they are potentially going to hurt their credit card score," said Woolsey.
If they do this to you let them know what you think. After all of the business that I have done with Bank of America, if they start charging me a fee to use their card, I will never apply to them for credit again. I will use Discover, or JCB, or Fred's (a Steve Martin joke).

I seriously hope that, if they try this, it hurts them badly.