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Anyone know Credit Card Laws?

post #1 of 15
Thread Starter 
We're still having problems with one credit card company (I won't say who on the public board for liability reasons). Earl called and canceled the card well before the 1 year and annual fees were up. The next billing cycle they hit us with $170 of renewal and annual fees (on a card with a $300 limit, mind you!), and of course the $30 overlimit fee. He's been trying to call them for 2 weeks and kept getting disconnected. He finally got through today and he has to talk to one person (like he will ever be able to get through to her!) who deals with cancelled cards. He was also told, however, that as long as there is a balance on the card they will charge their annual fees ($70) and renewal fees ($100 - whatever that fee is!).

Is that legal to keep charging annual fees and renewal fees AFTER the card has been cancelled? The annual fee I can maybe see, but we sure as heck didn't renew anything.
post #2 of 15
Credit cards are the worst. i for one hope you get the bill erased. Those fees are outrageous. I hope someone here has some insight for you.
post #3 of 15
My understanding is:

If you used the card in 2002 and you cancelled the card in 2002
you will still be accessed the annual fee.

If you cancelled the card in 2001 and are being accessed fees for 2002 then you have a problem.

Good Luck!:tounge2:
post #4 of 15
I don't know the law, but I just wanted to say I sure hope you get this straightened out without the GD charges without too many headaches!!!!!!

post #5 of 15
I have never heard of a 'renewal' fee.

Annual fees are usually charged at the beginning of the calendar year. Since you still have an outstanding balance, they have the right to charge you the respected fees since you have not completed the terms of the credit card agreement(ie:payed back the amount owing).

You should also be able to see the terms of this credit card agreement on the back of your statement. Most card companies will print the basic rules/regulations there.

I worked for a credit card company for 2 years. Let's just say those years were not fun!
post #6 of 15
Credit card companies have their own set of laws!!

First of all, the place where their mailing address is is where they fall under law. Most of them use Maryland, because MD laws are very pro credit card. I bet that you mail your payment to MD. Most CC companies are in MD, or at least their mail is.

They can basically charge you even if you cancel the card if there is still a balance. Reason being, the card may be "closed" but if there is a balance then the account is open and subject to fees. Once you pay off the balance, you should only have to pay this years annual fee then, and that should be the end of it. As far as a renewal fee, that will fall under the situation that if there is a balance then the account is "renewed" because its still open.

post #7 of 15
Ugh! Sounds like a real headache. A renewal fee every time dtolle? Sounds like they have a few by now, that can't be right...
post #8 of 15
The renewal fee should not be charged if you have cancelled the card whether there is a balance or not. I worked for a card company for 3 years. With that company (will not mention any names), once you had requested the card cancelled (in writing), that was it. No more fees, whether you had a balance owing or not. As long as the card was not in use after the cancellation request, then all fees were not charged. Sometimes, the 'system' would charge the fees (usually the fault of the operator not letting the 'system' know the card was cancelled). If that was the case, fees were reversed but ONLY at the customers request. Mind you, I was the main person doing the reversals and every customer I dealt with, I happily reveresed fees for...nice hey? lol

Make sure you have cancelled the account IN WRITING. Then request all fees to be reversed, also IN WRITING. Make sure you check the terms and conditions of that card as all companies are different.
post #9 of 15
Do NOT call anymore. Get everything you have - dates, cancellation date especially and times and dates you've called to cancel the card. WRITE them with all of this and explicitly tell them that as of such and such date you cancelled. Also say, "Any further attempts to collect on this cancelled card will cause (YOU and your husband)." to report them to your state's Attorney General and the Federal Trade Commission." Don't get too nasty, just keep it matter-of-fact and be very explicit and adamant about the cancellation.

Quite frankly, I'd call the two agencies anyway. The Federal Trade Commission can be contacted in writing (when you finish off the bottom of the letter make sure you cc: Federal Trade Commission and the state's Att. Gen.) at United States of America, Federal Trade Commission, Washington, D.C. 20580. Their phone # is: 1-877-382-4357, they are also at www.ftc.gov. Hopefully, you didn't throw anything away that they have sent you. Even if you did, write them and blast them. Also tell them that any further attemps will be ignored. Then check your credit rating and make sure there are no charge-offs about this in any of the three major credit reporting companies. A first report can be sent to you for FREE.

Good luck.

How do I know this? I've been a certified legal assistant for the better part of 22 years, and I'd rather stay home with my cats.
post #10 of 15
I had something similar happen to me with a credit card, too. I dont know why, but I got an advertisement for a free credit report with no obligation along with my statement; this was a store credit card, btw. So, I figured I would get one, and it said after 30 days you could cancel. They kept charging the credit card, yet not once did I receive the report. I eventually, went so high up the chain the paid the fees for me and then I told them to close the account asap, which they did. Have you tried going thru the BBB, too?
post #11 of 15

Perhaps in different states the laws may differ, but I am sure that in MD, they can charge you if there is a balance. I worked for a credit union based out of Maryland, and I did a lot of dealings w/ our visa dept. We charged a fee on the card until it was paid in full.

By all means, if anyone thinks what is happening is illegal, then contact the better business bureau, and the credit agencies.
post #12 of 15
Thread Starter 
I just checked and they are actually based in Florida. I have no idea what type of laws they have there - anyone know? As far as checking anything in writing, well, we haven't received an invoice from them in at least 6 months. We made a payment on line one time and they stopped sending anything, and have pretty much refused to start again. We attempted to get some late charges reversed (we didn't get a statement so we didn't know the exact date and made the payment a couple days late), and all you can do is write to one department where they send you a form letter saying that your account was accurately charged. I think they have a policy that no charges will ever be reversed. I know that their general customer service people cannot make any changes to your account. They do acknowledge that the card was cancelled.

I will have hubby get in touch with the FTC and find out if this is legal in their state, and if there is anything we can do to fight this. I'm still hoping it was just a computer glitch, but I have a feeling they are going to insist that the charge is correct and we have to pay it.

The whole company is out to screw with you as much as possible. They market to bad-credit/no-credit people and then rape you with fees. If you are called and agree to look at the card, you are enrolled and the $150 annual fee and origination fee is applied before you even get the card and have a chance to see the terms, and the most you get in credit is $300. Interest also starts the day they send out the card on their fees. If you want a credit increase, they charge you another $100. I have never hated a company as much as I hate this one. They prey on ignorance, which hubby fell for - he was ignorant of how credit cards worked - and once they get you it's nearly impossible to get out of.

Thanks for all your help everyone. I really hate dealing with this company anyway and if I had the money I would just pay it off in full. Unfortunately I'm not in a position to be able to do that.
post #13 of 15
I was lucky to find the customer service job with a credit card company. It was a summer job that I ended up staying on while I was in University. It made me aware of credit and all the implications including how it influences your credit report and ratings.

In my opinion, a credit card is the devil unless you are paying it off each month. Otherwise, the temptation is too strong for most people to resist and they end up paying 3 times the intended sale price on purchases.

I've still never heard of a 'renewal fee'. Maybe it's only in the U.S.A.? Or it's with smaller cards that I haven't dealt with.
post #14 of 15
Thread Starter 
I've had quite a few credit cards in the past (only 1 right now to rebuild my credit), and this is the first one I've ever seen to have a "renewal fee". But this company also does not have a toll-free phone number (call and wait on hold on your own dime!), and charges for everything. I really hate them. With companies like this it's no wonder there are so many bankruptcies!
post #15 of 15
Heidi, I don't have any good advice for you here, and I wish that I did, but I just wanted to say how sorry I am you are having to go through this...money is tight as it is without credit cards charging such high annual fees, interest, and late fees.
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