Consumer complaint received 2024-10-03
Product: Credit card — General-purpose credit card or charge card
Issue: Fees or interest — Unexpected increase in interest rate
Company: NAVY FEDERAL CREDIT UNION (TN)

( a ) With respect to extensions of credit made on credit card accounts, a bank may charge and collect interest at an annual rate not exceeding thirty percent ( 30 % ) per year or at an equivalent daily, weekly, monthly, or quarterly rate. 
( b ) In addition to the interest charges authorized by subsection ( a ), a bank may charge and collect with respect to credit card accounts additional types of fees and charges that are agreed upon between the bank and the cardholder, in amounts that are specified in or determined in accordance with the agreement between the bank and the cardholder. The additional fees and charges may include, but are not limited to, a monthly, annual or other periodic charge, and/or a one-time charge, for the privileges or services made available to the cardholder under the plan ; transaction charges for each purchase or cash advance under the plan ; a minimum charge for each monthly, annual or other scheduled billing period under the plan during any portion of which there is an outstanding unpaid indebtedness ; a late payment or delinquency charge ; fees incident to the application for and/or the opening, administration and termination of a plan, which in the case of secured plans, may include, but not be limited to, fees and charges relative to the inspection, verification, and protection of the collateral and the establishment, perfection, enforcement and release of the security interest ; returned payment charges ; charges for providing sales slips, invoices, checks, duplicate periodic statements or other documents ; stop payment fees ; charges for exceeding a predetermined credit limit or for initiating a transaction that, if consummated, would result in an outstanding balance in excess of the credit limit ; automated teller machine charges or similar electronic or interchange fees or charges ; charges for issuing additional or replacement credit cards ; and other fees and charges that may be agreed upon between the bank and the cardholder. 
( c ) If credit under a credit card plan is offered and extended in connection with overdrafts under a demand deposit account or other transaction account maintained by the cardholder with a bank, the bank may continue to impose any charges customarily imposed by it under the terms governing the demand deposit or other transaction account, including, but not limited to, check charges, monthly maintenance charges, checkbook charges, debit card charges, charges for checks drawn on funds in excess of an available line of credit and other similar charges, without the necessity of the bank making specific reference to the charges in the agreement governing the credit card plan, and the amount of the charge may be charged to the cardholder 's account under the plan.

( d ) In the event a borrower defaults under the terms of a plan and the bank refers the borrower 's account to an attorney ( including a regular salaried employee of the bank ) for collection, the bank may, if the agreement governing the credit card plan so provides, charge and collect from the cardholder a reasonable attorney 's fee and, in addition, if the agreement governing the plan ( or, in the case of secured plans, the security agreement or similar instrument ) so provides, the bank may recover from the cardholder all court and other collection costs, including, in the case of secured plans, all costs of enforcing the security agreement or similar instrument, actually incurred by the bank, including those incurred on appeal. Banks may charge and collect interest charges following default of the cardholder and/or judgment in favor of the bank at the rates permitted by this part. 
( e ) If a bank purchases or satisfies an obligation of the cardholder at less than the face amount of the obligation, the discount is not considered a fee or charge limited by this section.