Most people get into a habit of tossing out junk mail and I am no exception. This stuff takes up way to much of my time. It seems like we get more junk mail than just about any other type. But don’t be too quick to toss all that stuff out because as I have found not everything that looks like junk mail is junk mail. Confused, well I think that is on purpose. You see some companies, I am convinced, want you to toss it all out without looking at it first. Lately I have been fortunate enough, or alert enough to catch two such pieces of so called junk mail before they made their way to that famous file 13.
You see my wife and I have been using certain accounts to pay down our debts for several years now. We were blessed when we moved to Charlotte to receive some very generous fixed low rate loan offers that we have used to transfer some of our debt into that has helped us leverage this debt quicker than we could have done on our own. Well over the course of the time that these companies that have offered us these great rates , from time to time they have made changes to their terms and conditions. With these changes have come one disclosure statement after another. Now I will admit I never read any of these word for word in the past, mostly I would just skim over them and then toss them. I don’t think I could give you any real details on what 99% of these notices contained. Most of them were changes in payment addresses or a change in late fees for those who pay late, which thank God has not been us so far.
Well all that changed in a big way two months ago. Fist came a letter explaining that one of our creditors had been bought out by a bigger more stable company. This did not concern me much as I had a relationship with both companies and the new one was better than the old one in my eyes. My only concern was that the deal that I had with the original lender not change. So far so good on that front, at least at first. A few weeks later and we received a change of terms notice. Again when these things come I usually scan them and then toss them. That is what I did this time. Now I don’t know why but the next day I decided to drag the change of terms paper out of the waste bin and take anther look at it. It had bugged me that some of the wording in the change of terms had included language about interest rate changes. They were almost doubling. Now most of the time when I saw something like this I did not phase me because after all we were locked in at a fixed rate, so I had nothing to worry about, right?
Wrong! As I took a closer look at the fine print I discovered that what I thought was a change in rate for late paying customers or new customers was going to be forced on all customers regardless of past agreements. I could not believe what I was reading. Well I immediately picked up the phone to get some clarification. After a few minutes of discussing this with customer service I came to the sickening realization that the deal I had, might not exist anymore and I was about to pay a lot more in interest than I was prepared to pay. Now I am not going to go into the legality of all of this and I am guessing that sometime in the near future you are going to hear of some class action law suites over this very thing because they were not picking on me, they were sending this out to all their new customers from the bank they just bought. What really upset me is if I had not went back and looked at it a second time I would have been completely caught off guard the very next month when the new statement arrived.
So what to do? How do you fight back when the big bank changes the rules. Well lucky for me I just asked a simple question of the customer service rep I spoke to. I asked is there anyway I can avoid being hit with the rate increase. To my surprise she said “Yes, but you will need to close this account, and never use it again, and never be late.” This was great news for me. We had not increased this line of credit at all almost from the time it was established, and further more, I had never been late, praise God. So I asked her to close the account for me, and she did. Hopefully that will be that and we will be able to pay it off without any more trouble.
Had this been the only situation like this I might have never thought much about it but the very next month I got another disclosure from one of my other lenders. This disclosure was not discarded. After what happened just the month before I read every jot and tittle of this one. It did not take me long to discover another big issue was about to descend upon my financial peace of mind quicker than you can say bankruptcy. This time the circumstances were similar in that we had had this account for a very long time and at a low fixed rate. It too was an account that we were using to pay down debt. But this change was different than the last. This time instead of doubling my rate, which I guess they could not do because I had never been late and the loan had not been sold like in the case of the first one, no this time they were going to more than double my monthly payment. Well as you can imagine, if you are like me and on a tight budget, this was very hard if not impossible to swallow. As a matter of fact if I did not get some sort of resolution quickly I was going to be facing the real possibility of bankruptcy.
Again I found myself on the phone with customer service. Again I asked them what could be done to keep me from having to pay this new payment that was more than twice what I was paying. They said basically the same thing that the other bank had said, but they added that they would work with me in an incredible way, but not before taking a look at my payment history. Again this is where I have been blessed. In the years that I have had this account I had never been as much as a day late and I always paid extra when I could. As it turns out this worked in my favor. The customer service rep said she could lower my rate (that’s right lower my rate) and this resulted in a savings for me of about $100 a month. Also she informed me that at this new rate and payment I would be able to pay this loan off in five years. I could not believe what I was hearing. Here I was ready to fight with them over these changes and fully prepared to have to get a bankruptcy attorney, to getting some very good news. Not only that but I had another smaller loan with then and they did basically the same thing on this loan as well which saved me even more money.
Now things would have went much differently had I not read the fine print. So I beg you be on the look out for change notices from your creditors. It is very important that you look over these documents and not discard them. If banks and creditors will do this to a customer like me who so far has paid on time, what are they going to do to the customer that is late on occasion? Why are they making these changes in the first place? I suspect the economy is their most convenient excuse. The truth is just like the average consumer, these banks are over extended and in trouble themselves. They are looking for every angle they can, legal or not, to try to rectify the situation before the economy or the government or both forces them too. I don’ t think it is fair what happened to me at all, but that is why it pays to pay in cash and not get in over your head. After all the Bible says “The rich rules over the poor,And the borrower becomes the lender‘s slave.” (Proverbs 22:7 NASB).
