Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
BofA Credit Card Bull**** Policy
Old 03-07-2007, 12:23 PM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
BofA Credit Card Bull**** Policy

This is a new one. I got an credit card agreement amendment letter from BofA today -- the kind of thing no one ever reads.

Here's one of the new policies:

Quote:
MINIMUM FINANCE CHARGE

Your account will now have a minimum finance charge of $1.50 per month. You may reject this by writing us a letter telling us you reject this charge. We added a 1Minimum Finance Charge primarily due to a change in our business practices.
How do they get away with this stuff? I respect their right to put any kind of charges that they want, but this business of having a charge that you don't have to pay as long as you read the fine print is not right. I'm guessing that allowing rejection allows them to get around some regulation.

Mod EDIT: Changed code to quote to fix wider-than-screen problem. -BMJ

__________________

__________________
Al
TromboneAl is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 12:25 PM   #2
Thinks s/he gets paid by the post
 
Join Date: Jun 2005
Posts: 4,005
Re: BofA Credit Card Bull**** Policy

The "minimum finance charge" usually refers to the minimum amount they will charge you IF you incur any finance charge at all. In other words, if you have a $0.05 finance charge, they will charge you the min of $1.50. Sure that isn't what they mean?
__________________

__________________
justin is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 12:30 PM   #3
Thinks s/he gets paid by the post
cube_rat's Avatar
 
Join Date: Jul 2005
Posts: 1,466
Re: BofA Credit Card Bull**** Policy

I agree with Justin here. If you're still unhappy with BofA's finance policy, just sock drawer the card. There are plenty of CC fish in the sea.
__________________
fuzzy? cute?
cube_rat is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 12:48 PM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
Re: BofA Credit Card Bull**** Policy

Ah, yes, I rechecked the fine print, and you're right, Justin. Thanks for that info. I guess there's no point in mailing in my rejection then. What would I do without you guys?

You're right Cube, but the problem with switching would be that I have a security freeze (protection against ID theft) on my credit report, so that if I ever wanted to change company, I'd have to unfreeze that ($10 * 3 credit reporting agencies * 2 (DW & me)).

It's still strange that they have a policy, but say "you can reject this." Why is that?
__________________
Al
TromboneAl is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 01:52 PM   #5
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 608
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by TromboneAl
You're right Cube, but the problem with switching would be that I have a security freeze (protection against ID theft) on my credit report, so that if I ever wanted to change company, I'd have to unfreeze that ($10 * 3 credit reporting agencies * 2 (DW & me)).
When I applied for Penfed card, seems like they approved it instantly; I thought
maybe it was because I already had a couple times the requested credit limit on
deposit in the 6.25% CDs, but maybe they still require a credit check. Maybe a
thought if you DO have CD money there, or would consider one at the current
lower rates.

They're really helpful, so call and ask. Maybe I'm naive, but I feel better giving
my CC business to a CU.



__________________
JohnEyles is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 02:51 PM   #6
Thinks s/he gets paid by the post
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 2,401
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by TromboneAl
It's still strange that they have a policy, but say "you can reject this." Why is that?
From a legal theory standpoint, in order for a contract to be valid, there needs to be a "meeting of the minds" where T-Al and BofA both agree to the contract terms. BofA wants the contract to be valid because they want it to be enforceable because they want to collect their minimum finance charges. However, they don't want to call up all 6 bajillion cardholders individually and say, "Hey, are you OK with this?" so they send out these little notices that you can read if you want. If you subsequently do whatever it is they say that will indicate your agreement to the new terms, then you will have been considered to agree to the new terms and therefore the contract is valid and enforceable.

The process must be such that a reasonable person could have a way out of declining the contract modification. If not, then that violates some other legal theory that I can't remember offhand. Something along the lines of you can't coerce someone into a contract.

2Cor521
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 03:15 PM   #7
Thinks s/he gets paid by the post
maddythebeagle's Avatar
 
Join Date: Jun 2005
Posts: 2,450
Re: BofA Credit Card Bull**** Policy

T-Al pays his credit card off every month in full so doesnt have to worry about it...
__________________
- Hurry! to the cliffs of insanity!
maddythebeagle is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 05:08 PM   #8
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 608
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by TromboneAl
How do they get away with this stuff?
It's called having a government that is bought and paid for by big business.
Try to watch the PBS Frontline episode on credit-card companies; it's quite
incredible.

__________________
JohnEyles is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 05:18 PM   #9
Recycles dryer sheets
 
Join Date: Jan 2006
Posts: 256
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by TromboneAl

You're right Cube, but the problem with switching would be that I have a security freeze (protection against ID theft) on my credit report, so that if I ever wanted to change company, I'd have to unfreeze that ($10 * 3 credit reporting agencies * 2 (DW & me)).
Hey Al,

I know I've sen it before but how'd ya freeze it. Would like to do...

Thx

W
__________________
wallygator69 is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 05:19 PM   #10
Full time employment: Posting here.
UncleHoney's Avatar
 
Join Date: Aug 2006
Location: Columbus
Posts: 769
Re: BofA Credit Card Bull**** Policy

Sombody at the CC company probably figured out they could make a few extra bucks each month by raising the minimum and to give everyone a chance to refuse makes it legal. They probably also know exactly how many replies they will get and it's all factored into their return on investment. Spend a little money on paper and postage and start counting the money.

__________________
100% retired and working hard at it.
UncleHoney is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 05:19 PM   #11
Thinks s/he gets paid by the post
 
Join Date: Aug 2004
Location: Laurel, MD
Posts: 2,947
Re: BofA Credit Card Bull**** Policy

T Al
Mighty nice of you to report this..........my copy went straight in tha dumpster. I would still write the letter, tho. I wonder what they charge if you reject the 1.50 minimum?
__________________
...with no reasonable expectation for ER, I'm just here auditing the AP class.Retired 8/1/15.
jazz4cash is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 05:29 PM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
TromboneAl's Avatar
 
Join Date: Jun 2006
Posts: 11,197
Re: BofA Credit Card Bull**** Policy

Quote:
I know I've sen it before but how'd ya freeze it. Would like to do...
Since 2003 all California residents have had the right to freeze their credit reports, prohibiting credit from being issued in their names. This was a first in the United States. Now, more states offer their residents the same rights: New Jersey, Louisiana, Texas, Vermont, Washington, Nevada, Connecticut, Illinois, Maine, North Carolina and Colorado. However, Texas, Vermont, Illinois and Washington limit this opportunity to those who have been the victim of identity theft or a security breach.

That article has links for how to do it for each state.

Quote:
I would still write the letter, tho.
Well, since I do pay my balance each month, and even if I forgot to, the finance charge would probably be over $1.50, I can't justify sending the letter.
__________________
Al
TromboneAl is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 08:59 PM   #13
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 678
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by SecondCor521
From a legal theory standpoint, in order for a contract to be valid, there needs to be a "meeting of the minds" where T-Al and BofA both agree to the contract terms. BofA wants the contract to be valid because they want it to be enforceable because they want to collect their minimum finance charges. However, they don't want to call up all 6 bajillion cardholders individually and say, "Hey, are you OK with this?" so they send out these little notices that you can read if you want. If you subsequently do whatever it is they say that will indicate your agreement to the new terms, then you will have been considered to agree to the new terms and therefore the contract is valid and enforceable.

The process must be such that a reasonable person could have a way out of declining the contract modification. If not, then that violates some other legal theory that I can't remember offhand. Something along the lines of you can't coerce someone into a contract.

2Cor521
You're close, but not exactly on point here. When you sign up for a credit card, you agree that the credit card company can amend the terms of the credit card agreement at any time, with X days notice (usually 15 days). Therefore, as a matter of contract law, all BOA has to do to get your assent (or "meeting of the minds") regarding the new contract term is to notify you of their intent to make the change (increase the minimum finance charge), and once notified, if you continue to use the card after the notice period has expired, your continued use of the card, by itself, is sufficient to indicate your assent to the new terms. There is abundant case law on this point, that your actions alone can express your assent to contract terms. Thus, BOA is not required to give you the option to opt out in writing order to get your assent to the new terms.

The reason why BOA gives its customers the option to opt out of the new minimum finance term by giving notice in writing, is to set up a defense to the argument that the new term is unconscionable. If they did not provide that option, an arbitrator might conclude that although the cardholder assented to the new term by their continued use of the card after notice, the cardholder really had no realistic choice if they wanted to continue to use the card, and therefore, the term was unconscionable and unenforceable. (In laymans terms, the new term was presented on a "take it or leave it" basis, with no real opportunity to bargain) They would then be facing a class action lawsuit on behalf of all of their cardholders. However, by offering a choice to reject in writing, BOA will argue that the new term was not unconscionable because the cardholder really did have a choice...he could have simply declined by giving written notice, and the new term would not have taken effect. If this argument prevails (and it might), then they would be able to succesfully defend a class action suit (or, more likely, it would not be brought in the first place) Of course, BOA knows full well that the vast majority of its cardholders simply don't read the fine print of every change to the cardholder's agreement, and even those that do probably won't care enough to write. And they probably know that the people who are diligent enough to actually read the fine print are the same people who are diligent enough to pay the bill in full, and they don't have to worry about finance charges in the first place. Therefore, BOA knows that only a tiny percentage of people will opt out, while the vast majority of people who pay finance charges will be charged the higher fee, and they have (arguably) innoculated themselves from an unconscionability challenge and an expensive class action suit.
__________________
JustCurious is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 09:31 PM   #14
Thinks s/he gets paid by the post
SecondCor521's Avatar
 
Join Date: Jun 2006
Location: Boise
Posts: 2,401
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by JustCurious
You're close, but not exactly on point here. When you sign up for a credit card, you agree that the credit card company can amend the terms of the credit card agreement at any time, with X days notice (usually 15 days). Therefore, as a matter of contract law, all BOA has to do to get your assent (or "meeting of the minds") regarding the new contract term is to notify you of their intent to make the change (increase the minimum finance charge), and once notified, if you continue to use the card after the notice period has expired, your continued use of the card, by itself, is sufficient to indicate your assent to the new terms. There is abundant case law on this point, that your actions alone can express your assent to contract terms. Thus, BOA is not required to give you the option to opt out in writing order to get your assent to the new terms.

The reason why BOA gives its customers the option to opt out of the new minimum finance term by giving notice in writing, is to set up a defense to the argument that the new term is unconscionable. If they did not provide that option, an arbitrator might conclude that although the cardholder assented to the new term by their continued use of the card after notice, the cardholder really had no realistic choice if they wanted to continue to use the card, and therefore, the term was unconscionable and unenforceable. (In laymans terms, the new term was presented on a "take it or leave it" basis, with no real opportunity to bargain) They would then be facing a class action lawsuit on behalf of all of their cardholders. However, by offering a choice to reject in writing, BOA will argue that the new term was not unconscionable because the cardholder really did have a choice...he could have simply declined by giving written notice, and the new term would not have taken effect. If this argument prevails (and it might), then they would be able to succesfully defend a class action suit (or, more likely, it would not be brought in the first place) Of course, BOA knows full well that the vast majority of its cardholders simply don't read the fine print of every change to the cardholder's agreement, and even those that do probably won't care enough to write. And they probably know that the people who are diligent enough to actually read the fine print are the same people who are diligent enough to pay the bill in full, and they don't have to worry about finance charges in the first place. Therefore, BOA knows that only a tiny percentage of people will opt out, while the vast majority of people who pay finance charges will be charged the higher fee, and they have (arguably) innoculated themselves from an unconscionability challenge and an expensive class action suit.
Yeah, that. Good thing IANAL.

2Cor521
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
SecondCor521 is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 09:50 PM   #15
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,487
Re: BofA Credit Card Bull**** Policy

it's not clear to me why so many folks complain about credit cards ... we should all know the term to which we've agreed, and if we don't like those terms, we're not forced to use the damn card! what i know is that i'd never willingly pay the interest rate they charge ... so i don't! i pay the balance owed in a timely manner.
__________________
d is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 09:59 PM   #16
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 678
Re: BofA Credit Card Bull**** Policy

IANAL?
__________________
JustCurious is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 10:08 PM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
youbet's Avatar
 
Join Date: Mar 2005
Location: Chicago
Posts: 9,965
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by RustyShackleford
Maybe I'm naive
Yes
__________________
"I wasn't born blue blood. I was born blue-collar." John Wort Hannam
youbet is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 10:13 PM   #18
Moderator Emeritus
Khan's Avatar
 
Join Date: Aug 2006
Location: Pine Island, Florida
Posts: 6,868
Send a message via AIM to Khan
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by JustCurious
IANAL?
I am not a lawyer.
__________________
"Knowin' no one nowhere's gonna miss us when we're gone..."
Khan is offline   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-07-2007, 10:19 PM   #19
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2005
Posts: 13,263
Re: BofA Credit Card Bull**** Policy

IANAL either (just learned this )

But, I think JustCurious is close but a bit off... IMO they allow you to opt out which will 'freeze' your old terms, but they would not allow you to charge on those terms anymore... but you would still be able to pay off any balance you had on the old agreement...

BTW, did you see the article about the Congress and how they are taking the CC companies over the coals? This one guy borrowed $3200, but had interest, late fees, over limit fees that totaled over $10,000... had paid over $6,000 on the balance.... he was in front of congress talking about the high fees..

Now, they are running to change them a bit so they don't get regulated..
__________________
Texas Proud is online now   Reply With Quote
Re: BofA Credit Card Bull**** Policy
Old 03-08-2007, 10:41 AM   #20
Full time employment: Posting here.
 
Join Date: Sep 2006
Posts: 678
Re: BofA Credit Card Bull**** Policy

Quote:
Originally Posted by Texas Proud
IANAL either (just learned this )

But, I think JustCurious is close but a bit off... IMO they allow you to opt out which will 'freeze' your old terms, but they would not allow you to charge on those terms anymore... but you would still be able to pay off any balance you had on the old agreement...
TexasProud, you are simply wrong. Which law school did you go to?
__________________

__________________
JustCurious is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Your unsecured (credit card) debt dies when you die (usually) JustCurious FIRE and Money 77 11-22-2010 10:05 PM
Secured debt (HELOC) vs Unsecured debt (credit card) Sue J FIRE and Money 6 03-07-2007 11:02 PM
Credit Card conundrum. CCdaCE FIRE and Money 21 08-25-2006 07:33 PM
Fraudulent credit card usage after phonedog, Pioneer Telephone free4now FIRE and Money 1 05-02-2006 06:50 PM
Credit card selection Skylark Young Dreamers 27 03-12-2004 02:10 PM

 

 
All times are GMT -6. The time now is 09:24 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.