Complaint Hub

When I finally got fed up with hearing, “I’m sorry, sir, we don’t accept Discover”, and went looking for a new credit card, I started off at Fatwallet, looking for a good deal.  I looked through their list of rewards cards for something with a 2% return on something that I would actually use.  The one that jumped out at me was a Chase/Countrywide card (Even though I hate Chase).  If you, like me, have a mortgage through Countrywide (Which I do, on our rental condo in Falls Church), this card will pay $50 towards that mortgage for every $2500 you spend on the card.

They just applied the first payment to my mortgage, and I was wondering what my long term savings were.  I have 27 years, 8 months left on the loan.  The wife and I intend to continue to rent out the condo as long as we can afford it (And that should get easier from year to year, as rents inevitably go up while the mortgage stays basically the same).  Now, it’s likely that we’ll refinance at some point, although the rate is 5.375%, so it probably won’t be until we can get a 10 or 15 year fixed mortgage instead of the 30 year.

Anyway, I found a mortgage calculator that would tell me my savings based on a one-time extra payment.  I don’t know how accurate it is, but it tells me that my one-time payment of $50 in the 27th month of the loan will save me $177 over the full remainder of the loan.  So my 2% reward turns into a 9% reward (I know, adjust for inflation, present day value vs future value, blah blah blah I dropped my econ major, remember?  It’s not a perfect calculation.).

So that’s pretty awesome.  And it shows how much a small early prepayment can help in a long-term loan.  So, while Chase’s customer service is, in my experience, unbelievably bad, this credit card is a great deal if you have a Countrywide mortgage.  I have no idea whether Bank of America will mess with this or not, but I hope not.

So, I have good credit.  I don’t carry a credit card balance.  I pay my bills on time.  I have a Citi World Dividend Mastercard or whatever the heck it is that I’ve had for maybe four years.  Actually, it was a different card up until a month or so ago, but they changed it, not me, so it’s been one continuous account as far as I’m concerned.  Anyway, I’ve NEVER missed a payment on it.

So I forgot to pay my November bill.  Just forgot to go to their website and schedule a payment.  Those jerks charged me interest, a $39 late fee, and raised my APR.  For ONE missed payment in four years.  They didn’t even contact me to say I was late.  My Discover card emails me and tells me if I haven’t scheduled a payment and my due date is approaching.  But Citi didn’t do that.

The first level CSR didn’t even think they should.  “Oh, we have so many cardholders, I don’t know how we could call them.  It would have to be on the computer.”  Well, of course, moron, I don’t want you to call me.  Why do you think I do as much business with you as I can on your website, and long ago stopped getting paper statements?  I don’t want to talk to you on the phone, or get any regular mail from you.

Anyway, the second level CSR that I got when I asked to cancel waived the fees, gave me some extra cash back bonus temporarily, and dropped my APR to 1.9% for 9 months, then it goes back to the rate I had before I missed the payment.

I’m planning to cancel the card anyway, but they don’t have to know that.

The message here is, when your credit card company does something stupid, call them and complain.  They’ll probably help you out.

Here’s another thing to add to the list of reasons I won’t get another Discover card.  At least, not until I exhaust all the credit card companies and have to start over.  My problems with Chase are well-documented here, and I’m not too fond of Citicards these days, either.

Anyway, Discover.  It’s not enough that they charge sellers such a high percentage, causing many places to not accept them.  But recently, they changed my card number.  They did it under the auspices of rolling out a new card, but what they’ve really done is change the card design, and probably renegotiated my terms of service.  It’s not a huge deal - I just have to tell a few places that I have a new card number for my monthly debits and whatnot.

But what really bugs me is that they’ve revoked my access to my old billing statements.  They’re treating this as a new card, and they’ve transferred the balance I had on my old card last month onto the new card.  And I don’t mean a revolving balance - I don’t ever revolve a balance anymore.  I mean just last month’s charges.  Now I have a bill that just says, you owe $X.  It doesn’t give me a breakdown of the charges.  I’ve requested a paper bill, but I really shouldn’t have to.  What if I want to go back and check a charge from two months ago?  I have to call and get another paper bill shipped.  I stopped getting paper bills a while ago because they’re dumb.  I have enough paper in my life already.

Anyway, this is very annoying. As soon as I spend my accumulated miles, this card is getting canceled.

Techdirt: Tighter Lending Standards Make Credit-Piggybacking Services More Popular

This issue — whereby a person can “piggyback” on another’s credit report and gain benefit from it — is just one that’s fueling financial institutions’ unhappiness with FICO scores, and the company behind the system, Fair Isaac, says it’s making changes to eliminate the positive influence of piggybacking.

Well, not exactly shoot the messenger, but I couldn’t think of a more accurate yet still catchy title.  What’s going on here is that people are using what amounts to a loophole in your FICO score that makes it beneficial to “rent” your good credit to some schmuck, allowing the schmuck to get a loan.

The proper response here, which is what Fair Isaac is doing, is to fix the FICO so that this doesn’t give the score lender a bump.  It will all but eliminate the market for this stuff because no one will want to do it anymore.

The improper response is what the lenders will probably do instead, which is to move away from the industry standard and make up their own numbers.

I did financial analysis at a very large company in the mortgage field for about a year just out of college, and one of the things I learned is that a FICO score is a remarkably good predictor of loan performance.  The company I worked for employed some very smart economists to try and come up with a better method (Or at least an in-house method so they could stop paying for FICO scores), and I don’t think they ever really improved on FICO.

And lately, lenders have shown that they really aren’t very good at predicting loan performance (See:  subprime mortgage market implosion).  So getting away from a score that may need a little tweaking, but has been really good for a long time, seems a little silly.