Consumer complaint received 2019-11-29
Company: AMERICAN EXPRESS COMPANY
State: NY
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Fees or interest
Sub-issue: Unexpected increase in interest rate

Complaint:
I have a card with American Express that without prior notice, raised my interest rate by 5.75 % ( current rate was increased to 22.74 % ). When I checked my statement on or about XX/XX/XXXX, I saw the rate increase went into effect on XX/XX/2019. Since I was not notified of this rate increase, I had used the card for basic household expenses and vacation expenses between XXXX - XX/XX/2019. I certainly would not have used the American Express card if the company notified me of the rate increase either by mail, email or a message when I logged on to its website. When I called the company on XX/XX/XXXX, the customer service representative claimed I was previously mailed a notice of this increase. This is false. I check all of the mail I receive from my credit card companies and the notice of rate increase from American Express was never sent. I checked my emails and never received a notification. The fact I was accused of lying about something of this nature was a shock. 

When I asked American Express during this call to review the rate increase, they promptly sent four copies of the same response on the same day denying my request to lower the rate to the older rate. ( These mailings I acknowledge receipt ) They claimed the interest rate increase was based on my FICO score, which from what I could see had remained unchanged for 2019, so this explanation was again a false assertion made by American Express. The letter also mentioned my FICO score was based on a " serious delinquency '' and " too few accounts currently paid as agreed ''. These contentions are also false. 

If American Express wanted to raise my rate without any explanation or justification, as a private company, they may believe it is within their right to do so. However, I did believe they were required to notify customers 45 days before the change which did not occur. When I spoke to their customer service I explained there was a change due to a temporary loss of employment this year which caused me to rely more on the credit cards, resulting in a 10-15 % increase to my overall debt. I therefore asked if they could waive the increase that went into effect on XX/XX/XXXX. If they chose to let it go into effect as of the date of my call that would be their option. Instead of American Express understanding my situation as a long-term user of the card and explaining they made an error in failing to notify me of the rate increase, American Express ' customer service claimed in a conclusory manner that I was notified of the rate increase. Essentially, their attitude was that I was lying about this and they are not concerned about the average individual card holder. To date, the company has never provided me with any proof that they sent the notice by regular mail, email or any other available means. 

I used this particular American Express card for over 13 years and was probably using their cards overall for approximately 18 years. This conversation on XX/XX/XXXX gave me a whole new perspective into how credit card companies think of their card holders. The indifferent response to a long-term card holder again came to me as a shock given how this particular company was receptive to me in the past when I called about other matters. I was obviously stupid into thinking long-term use of a card meant loyalty by a credit card company to its customers. 

American Express ' unexpected increase in my interest rate has now made it more difficult for me to pay off my remaining credit card debt balance. I have no explanation of how American Express increasing my interest rate and losing a long-term customer was to its benefit other than believing this increase will make it impossible for me to ever pay off the existing debt. If the company 's computers calculated I was a risk of not paying off the debt then they should have taken other action besides raising my interest rate. While I am aware of the credit card debt I have accumulated over the years and I certainly want to reduce or eliminate it entirely, American Express clearly has no intention of making this possible. If a situation such as mine occurs to numerous other credit card users who live paycheck to paycheck, even an unanticipated 6 % rate increase can render a person unable to make the minimum payment. This inevitably results in yet another interest rate increase due to a default, thereby allowing American Express to proceed with a lawsuit, enter judgment and go after the individual by wage garnishment or the seizure of personal property. 

On a final note, the Minimum Warning Payment I have on my statements do not indicate how much I would need to pay each month to pay off the balance in 3 years. I was of the understanding that this was legally required.

Company response to consumer: Closed with explanation