Letter to Chase about minimum payment increases

During the last twelve months Chase bank has twice notified many of its customers that their minimum payments would increase from 2% to 5% of their balance. Consumers Union has received complaints from more than 100 of these Chase customers, all of whom describe the following similar set of facts:

• These customers held balances subject to “fixed interest rate for the life of the loan” promotions offered by Chase through balance transfer and convenience check solicitations.

• They used Chase’s promotional offer for large loans in reliance upon the terms of the promotion.

• The consumers were not late in making payments.

• Most paid more than the minimum payment each month.

• The minimum payment was raised so that it included 5% of the balance (up from 2%)

• When contacted about the increase, Chase told the consumers that the minimum payment could be brought back down to the prior 2% level only if the consumer agreed to forgo the promised promotional interest rate and instead accept a doubled interest rate.

In this letter to Chase, Consumers Union and NCLC ask Chase for the following:

• Refrain from increasing consumers’ minimum payments, with respect to balances subject to promotional fixed interest rates.

• Restore the minimum payment for those consumers who have been affected by this change in terms, to the level in place at the time the consumer incurred the promotional balance.

• Restore the promotional “life of the balance” interest rates for those consumers who gave theirs up for the sake of a manageable monthly payment.