Direct Merchants Bank (DMB) Ripoff - Dramatic Interest Rate Increases Without A Justifiable Cause Phoenix Arizona

I too understand your frustration and have seen cases where your interest rate is increased only because the company wants to make more money but the truth is that its not illegal; the money you borrowed is theirs and they legally have the right to charge you up to 29% interest on it- even if your credit is good again its their money and while it is seems unfair to raise the interest just to make money you have to understand that that is their business- money. Companies often will raise interest rates on good consumers to compensate for the losses of "bad consumers" (like the many invalid complainers on this site) if this happens to you then you should pursue other avenues, get a different card and transfer the balance.

Tabitha, unfortunately, you have a very valid complaint. I was in that particular department that the options [when made available by the system] to lower the APR. You are one of the few [believe it or not] that have a legit reason to be upset especially if you have good behavioral scores with the company and a good FICO score. I in team meetings would bring up those situations where based on the information on my system I could understand the reason for the increases. Even if it was based on revenue increase [and yes those letters really did go out] I don't understand why on a good client since that would alienate those and would of course close accounts. I feel for you because I myself never recieved an explanation to similar cases such as yours. A few things though about how the credit card was being offered. It is offered to those with less than perfect credit. It is offered to those in the soso credit zone. There are exceptions from long time clients from back when it was FingerHut card or even from acquired accounts from other banks. My point being that for those clients that complained that they had wonderful scores, the fact of the matter was that they didn't. There scores got better perhaps after DMCCB because of good payment history with us and what not, but just wanted to give you an understanding who the credit card is being offered to.
As far as Credit Limit increases thats an intersting thing. If the company is raising APRs to increase revenue that means there might be a cash flow situation right? So if theres less cash to be had and profited there will be less lines of credit increased than usual [to be able to secure what is being newly allotted to the card holder] even to the point where we stopped doing increases for a VERY long time.
In regards to that letter I think the request of that letter in the system was bugged. Honeslty I believe so. The only time we would or should in any case request that letter is when in the memos on your account generated automatically from the system it read "AA Repice 29.99" for example. AA would signify Adverse Action. Now, being the empployee and seeing this I would think "hey you credit, is not as perfect as you think" but every time we would request through the sytem the letter of explanation for the AA it was always that same ltter you quoted. Always. For everyone as far as those that called back about it. I never understood that. What adverse action had the client taken if they had always paid on time and were the ideal client. Later on someone in upper management in "private" clued me in on something. It is not to the advantage of the card holder to payoff his/her account every month. The Bank isn't making any profit on you. Now, honestly I don't know if this is true or not but it doesn't seem fair, but not being fair doesn't make it illegal unfortunately.

i too have been in the same boat with direct merchants bank. it took me 6 months, but the registered letter i sent finally got my message across. i informed them that if they didn't return my interest rate to what it was, i would contact the attorney general. we had not been late either, but did get close to the limit. mine went from 13% to 29.9% in 1 month. they offered to lower it to 23% but i told them they just raised it 10%.

i got all different reasons for the increase until someone from the company finally told me that they frequently do increases "due to business needs". that raised a red flag, and caused me to write the afore mentioned letter. they did comply finally and lowered the rate to 16%, but for how long? if all goes well we will be rid of the account in a couple of months. hopefully that will be easier to obtain.

keep record of corrospondence, phone conversations and most importantly, names of individuals you speak to. send any letters by registered, certified mail, it's worth it. i too received the "increase of revenue letter"