Bank Of America

Monkeypox · February 18, 2008

Bank of America sent unmarked letters to customers with good credit, arbitrarily raising their credit card interest rates by two and three times. Most people won't read or notice the letters, because they bear no markings for Bank of America and are sent from a random PO Box in Arizona. No joke. If you are carrying a balance on any Bank of America credit cards, you'll want to read this:

http://www.businessweek.com/bwdaily/dnflas...ndex_best+of+bw

The basics come down to this. Bank of America is hemorrhaging money because they've been giving unsecured mortgages and credit cards to illegal immigrants. They had loaned a bunch of money to Countrywide (for said mortgages), who was going under (I wonder why), and essentially was forced to buy back their loans by purchasing the failing company. They're losing money really fast and need a quick cash grab. Well, the best bet for that is getting to the people carrying high balances but who have actually shown the ability to pay them, meaning they can transfer the balances or in some other way potentially pay off the cards, avoiding bankruptcy and making sure that BoA gets back the money. BUT, since they need to cover all these mortgages and credit cards that won't ever get paid, they're innocuously raising APRs on the people with actually decent credit. Mine are going from 9.99% and 12.99% to 21.99% and 23.99%. I have not had a late payment or gone over the limit in 7 years. My credit score is solidly above average. I aggressively pay 3 to 5 times the minimums, but carry a balance. Again, THE LETTERS AREN'T MARKED. I have no idea why I opened these, because 99.9999% of these things I shred as soon as I get them. Most people would have NO IDEA they got them, and that's what they're counting on. IF YOU HAVE A BANK OF AMERICA CREDIT CARD, do yourself a favor and check into it.

greenminer · February 18, 2008

I don't know about that illegal immigrants part. Where did you read that?

Predatory lending, i.e. aggressively selling home loans (mostly ARMs) to people with below-to-average credit scores, has come back to haunt the economy. It's no secret that "recession" is being pondered everywhere you read right now. A low-employment rate is going to loom through mid-09.

BofA's pending buyout with CW has been in the works for a while. I have not heard of this rate increase until just now. Horrible for BoA card holders.

OT, but still a good read: From SmartMoney.com:

Recessions and unemployment have long gone hand in hand. During the recession in the early 1990s, the unemployment rate reached nearly 9%; in the early 1980s, it exceeded 10%. And even though the "r" word hasn't established itself with any certainty (yet) and the latest unemployment numbers remain fuzzy at best — December's 5% unemployment rate was worrisome, but jobless claims slipped to a four-week low the week ending Jan. 19 — economists' expectations are hardly optimistic.
"The labor market is going to struggle," says Sophia Koropeckyj, an economist at Moody's Economy.com. Even if the Federal Reserve is successful in its efforts to skirt a recession, Economy.com still projects "pretty weak" near-term employment growth. "We're not going to see a large increase in unemployment, but what we are going to see is that businesses, because of declining confidence in the economy — and we're already seeing that — are going to hold off hiring new people," she says.
Should the government's efforts (through rate cuts and a proposed economic stimulus package) fail to keep us from sinking into a recession, the job picture will look much bleaker than that. "We're looking at a contraction of the labor market through the middle of 2009," Koropeckyj says.

OldTimer · February 18, 2008

Re the illegal immigrants....it is a well known fact that Bank of America went after the illegal immigrant market with minimal or no documentation required to open an account. I have seen it all over the place on Fox TV financial web programs , and financial reports in the newspapers. OldTimer
I don't know about that illegal immigrants part. Where did you read that?
Predatory lending, i.e. aggressively selling home loans (mostly ARMs) to people with below-to-average credit scores, has come back to haunt the economy. It's no secret that "recession" is being pondered everywhere you read right now. A low-employment rate is going to loom through mid-09.
BofA's pending buyout with CW has been in the works for a while. I have not heard of this rate increase until just now. Horrible for BoA card holders.
OT, but still a good read: From SmartMoney.com:

UNTFan23 · February 19, 2008

B of A isn't the only large institution that is hurting from the sub-prime mess they created (which has absolutely nothing to do with lending to illegal immigrants). CitiGroup and others are really hurting by the write-offs from the sub-prime market.

UNTflyer · February 19, 2008

B of A isn't the only large institution that is hurting from the sub-prime mess they created (which has absolutely nothing to do with lending to illegal immigrants). CitiGroup and others are really hurting by the write-offs from the sub-prime market.

I wouldn't say it has nothing to do with lending to illegals, as they made up a healthy percentage of the no documentation loans... but there is certainly plenty of fault to pass around among the illegal immigrants and wanna-be house flippers and self-delusioned homebuyers who had no business signing a mortgage on that $750,000 McMansion and the sub-prime lenders who KNEW they were giving loans to people who could not pay...

But I'm afraid that the ones who will pay for this are the taxpayers who make sensible financial decisions and get the screws put to them once again. When politicians "work together" on a "bipartisan stimulus package", grab your wallet.