Complaint Review: Nextcard Visa and Merrick Bank - Phoenix, New York

In early August I received a letter from Merrick Bank that my Nextcard account had been aquired by them. I also noticed that upon acquisition my APR was increased to 19.70%. I'll deal with Merrick later. I don't know the circumsatnces of the acquisition, but I know that I have hated NextBank and NextCard for the past year.

Since January of 2001, my account has never been more than 1 day late being paid. Those months were April 2001 and Mar 2002. I paid on line, but the payment didn't process through their clearing house on time. I have almost ALWAYS paid more than the amount due on my statement by at least a few dollars. The months that I paid the exact amount due were December 2001, January, and February 2002.

With this company, you have no idea how much will be applied in interest because they don't allow you to know what interest has accrued before the billing cycle closes. This credit card was a consolidation of other accounts, which is why the opening balance was so high. However the only reason my account went over limit was because of the interest applied at the end of the billing period in September 2001. I had no way of knowing what the interest accrued was, but I was careful not to go within $100 available credit because the interest would be applied and would affect the account before I would ever know or be able to do anything about it.

In spite of my caution, i went too close one month and when I went on line to make an extra payment, the interest rate had already been increased. The accrued interest for that month hadput be over the limit by less than $2.00! That is, before the $39.00 over limit fee and the extra $50.00 or so in extra interest automatically applied from the rate being increased from about 13% to over 23%. It was not that I was out using my credit card frivolously, they claimed that when the interest put my account over limit, they reviewed my files and found derogatory credit that justified the increase. The same credit information was there when I applied in the first place!

After I got Nextcard to reimburse the overlimit fees and return my interest to a reasonable rate, I voluntarily closed the account to any further charges to ensure that this would never happen again. On the following statement, my interest was raised again to 18.99%, there was another high interest charge applied to my account and it went over limit again. They deliberately withheld the fact that the rate increase was automatic for any account that is closed by the consumer and could not be reversed or reopened without a new application and credit check. Had I been properly informed of that fact I would never have chosen to close the account, I would have simply not used the account and kept it at around 13%.

I have had an excellent payment history since this account was open. Payments have been made this year even in spite of having over $14,000 in financial losses from January to July of this year (over half of which occured in April & May), four deaths in our family from March to May 2002, and our son being born a month premature in June. My husband lost his job in March, I lost my income in January, we have had to move twice this year, and still we paid on time every month. Does this sound like a high risk account!? Most people would have requested a hold on the account payments (or just stopped paying) with such losses going on, but we didn't.

I have deplored doing business with Nextcard, who did everything but call me names, who dared me to file bankruptcy after I voluntarily closed the account. My husband and I have been doing everything we can to pay off all our debts as soon as possible. But when over $100 of every $130 payment goes to interest it's almost impossible to even put a dent in the account balance. They make it extremely easy to get a high credit limit, which encourages people to consolidate their bills with them , then they have them trapped and can charge them what they want on any technicality they pick. That is exactly what happened to us.

Now that Merrick has our account, as if to add insult to injury, our monthly payment has gone up by over $40! They absolutely refuse to talk to me about changing my rate. I have followed their 'all account inquiries must be in writing' protocol and have not gotten a response in over a month. As far as I am concerned, they let Nextcard hunt so they can buy the furs. Nextcard finds the customer, jacks up the interest and sell to Merrick, or whomever might want to buy a high interest yielding account.

Tera

Madison, Tennessee

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