Ask Jean Thursday: A Bright Side to the Hike in Your Monthly Minimum
To SheSelz…who wrote:
I also am a customer of Chase. I have never paid late in 30yr. They have just raised my monthly minimum payment from 2% per month to 5% per month, an increase of 250%. My interest rate is fixed at 3.9%. After reading the previous blogs, I’m not sure if I should call them or not! Does anyone else have other reports on how they have been treated on this type of problem? Is this problem only been occurring with Chase or other banks as well. Obviously they found the loophole that I missed in all the fine print!
Before you resort to calling — and we’ll talk about that in a moment — I want you to try to think of this as a gift rather than a punishment (and I know it feels like a punishment, with a credit card this cheap, the temptation is to use it for all expenses you have to carry.) But let’s say you have $10,000 in debt on that card. If you pay it off at 2 percent a month — at the 3.9% interest rate without charging anything else — it’ll take you 55 months. BUT if you can come up with the $500 it takes to pay the 5 percent a month, you’ll get out in 21 months. And save a boatload of interest in the process.
What if you can’t? What if it’s impossible to come up with that $500 a month? You simply don’t have the cash and you don’t have a way to get it? Then you call and you tell them that and try to negotiate something in between. Understand, they may cancel your card as a result (that’s their prerogative) or only be willing to cut the minimum so far or say no. But it’s better for your long term financial health if you can rob from the various Peters in your life to pay this particular Paul.
