About a year ago I was told by a reader to ask for the 5 year Chase Bank "Pro-Active" program as one way to combat Chase Banks change in terms on their low interest rate credit card offers.
Chase Bank basically STOLE anywhere from 10 million to 100 million dollars of its customers low interest rate savings on a monthly basis by increasing the monthly minimum payment on customers' low interest rate, life of the loan credit card agreement, by 150% above and beyond what their customers were already paying!
So if a customer was making a 400 dollar a month payment to Chase Bank, that payment would suddenly jump to 1,000 dollars a month! If the customer could not make the higher payment, they would default on the low interest rate credit card agreement (example, 2.9%), and the interest rate could increase to as high as 29%! In my opinion this was a criminal act by Chase Bank that to this day has not been rectified.
There may literally be tens of thousands of Chase Bank customers who took a huge financial hit because of Chase Bank first changing terms, then not allowing their customers to opt out of the change in terms.
Chase Bank went as far as to lobby the new credit card reform act of 2009 so that they WOULD NOT have to notify their customers whose terms had been changed that there was a way out of the mess.
Indeed, when I called the number the reader gave me, the five year paydown program was called the Pro Active program. However, when I got the Chase Bank welcome letter, I was so upset with Chase Bank (Because the accelerated paydown of this low interest rate credit card would cost me hundreds of dollars extra as I applied extra money to this low interest rate card that could have gone to pay down a higher interest rate credit card faster), that I just sort of glanced at their "welcome letter".
Today, I ran across the chase bank welcome letter again and noticed that I was being welcomed to the Chase Bank "Balance Liquidation Program". So even though I was told, and Chase Bank answered to the name Pro-Active, the other name that apparently describes the 5 year pay down program is called the "Balance Liquidation Program".
I recall banks sending me similar types of 5 year pay down programs, but the interest rate always seemed to be anywhere from 10.99% to 19.99%, or higher. I think two differences with this Chase Bank Balance Liquidation Program is that the regular customer service department may know who to send you to, whereas with the Pro-Active program they may not, the second difference is you may actually qualify for anywhere from zero percent interest to some other single digit interest rate not exceeding 9.99%.
The idea being that whatever interest rate you are presently paying, if you agree to close your account while continuing to pay off your closed account, you will get a low interest rate as an incentive.
So if you feel you can pay off a credit card debt that currently is at a high interest rate if the interest rate were lower, you may want to consider calling and asking about the balance liquidation program. I think other banks besides Chase Bank may offer this program as well.
Your credit score may take a small hit because of the closing of the account, but I think that is only for perhaps six months, then if you show that you are making timely payments, it should start to help restore your credit score, and you get the added bonus of paying less out in interest rate charges.
Don't forget, the Cat Who Ate Chase Bank, the book, coming out in sometime in 2010.
