Credit card companies have been hit hard by recent trouble in the stock market and the economy. You may think that credit card companies will continue to treat you, the consumer, in the same way they always have, but you’d be forgetting that credit card companies are businesses. When the economy hits credit card companies, they pass the trouble along to their customers.

Many credit card companies promise you that your rate won’t change until your card expires. However, in a 2008 survey of credit card companies conducted by Consumer Action, 77 percent of surveyed credit card companies answered, “Yes” to the question “Can you increase my APR or change my terms ‘any time for any reason’?”

Another trick used by credit card companies to get money from customers is to change your credit card limit. Most credit card users assume that their credit card limits will remain the same, or that credit card companies would warn them if those limits were going to change.

Common practices include “following a customer down” where the credit card companies will continue to reduce your credit card limit as you pay off a large balance, leaving you hovering on the edge of your credit card limit. Some credit card companies will reduce your credit card limit lower than your current balance, triggering over-limit fees. Other credit card companies simply change your credit card limit and you don’t find out until your credit card is declined.

Sometimes the credit card companies will make changes that have nothing to do with the consumer. According to the Consumer Action survey, “Four of the top ten credit card issuers cited factors beyond a consumer’s control that might cause interest rate increases such as: ‘market conditions,’ ‘the economy,’ and ‘business strategies.'”

Remember, credit card companies aren’t in business to take care of you. Credit card companies make money when you go over your limit or can’t make a payment. Keep an eye on your credit card statements, and don’t hesitate to call the credit card companies if you notice any changes.

July 30, 2008