[Rail Paul]

The banks are implementing policies ahead of the new federal regulations designed to limit their opportunities to change interest rates, impose high service fees, etc.

Chase has notified me that the triple points plan for buying ShopRite products will end in September. Double points for purchases of anything in ShopRite markets or liquor stores will also end. For now, triple points for Amazon purchases will remain valid on my Amazon card. I think the ShopRite deals are part of a larger reconsideration. The ShopRite Continental Airlines points plan will be scaled back, requiring that you hit a minimum threshold of purchases every three months, or lose that quarter's points.

Bank of America halved the credit line on an inactive card, too. They also implemented a series of new charges for exceeding a credit line, late payment, failure to pay a minimum balance, etc.

[bigbear]

Chase recently notified me of many changes for my VISA cashback account. No longer free... cashback limitations... etc.

I've been shopping around and, thanks to Gary Steiger at FreeFrequentFlyerMiles.com, I found another cashback card that suits me.

Pentagon Federal Credit Union offers a VISA Platinum Cashback Rewards card.

[Rail Paul]

Chase recently notified me of many changes for my VISA cashback account. No longer free... cashback limitations... etc.

I've been shopping around and, thanks to Gary Steiger at FreeFrequentFlyerMiles.com, I found another cashback card that suits me.

Pentagon Federal Credit Union offers a VISA Platinum Cashback Rewards card.

That's an excellent deal, Mr Bear. Thanks for pointing it out. 5% back on gasoline purchases sounds attractive too, with a 10 cent differential in many places for using credit, and prices pushing $3. And, 2% on supermarket purchases.

The 5% on airfare is a winner, even if it's a short timer now.

[bigbear]

It'll cost $5 to join the credit union.

If you have no "military" connection, it'll cost another $20 (one-time fee) to join the NMFA.

How to join (see #7).

[TaliesinNYC]

Expect annual fees to return sometime in the next couple of years.

Pending legislation in Congress re interchange fees (there are currently no fewer than three bills working their way through committee) will only make things worse.

ETA Chris Dodd (D-CT) sent a letter to the Fed last week directing them to draft regulations that will limit banks' and cc issuers' ability to raise rates ahead of the Credit CARD Act's effective date which could be as soon as August of this year or Feb 2010 at the latest.

[Rail Paul]

The WSJ notes that many issuers are pro-actively canceling credit cards, often without advance notice. It's legal.

One woman found her AmEx card had been canceled when she tried to pay for her day at the spa...

A few days after the spa incident, she received a letter confirming that the issuer had cut her off because of information contained in her credit report. She checked her credit report, and it was clean except for a late car payment in December 2005, she says.

More and more consumers are getting to the cash register to find that their credit cards have been canceled without their knowledge. Consumers say that it is often embarrassing to have a card declined in front of friends and other customers, and that it is frustrating when customer service is able to confirm only that the card was canceled, but not why.

But while it may seem to be bad form, in some cases, it is legal for a credit-card issuer to close an active account, like Ms. Horowitz's, and notify the cardholder, or send out a letter, after the fact. Even when closure notifications are received before a consumer experiences card denial at a register, letters can be lost in mailboxes, as consumers shuffle through piles of junk mail. Those who have recently changed addresses or are traveling are often left in the dust.

Although the law governing notification of account closures is nothing new, its effects are increasingly being felt by consumers as card issuers try to curb their own risk in an uncertain economy. It is unclear how many consumers have been hit by instant card cancellation, but cardholders at AmEx, Bank of America Corp., Citigroup Inc. J.P. Morgan Chase & Co. and HSBC Holdings PLC also say they have recently had their active cards canceled before they received notice.

We're re-assessing our risk

It wasn't fraud, he learned after calling customer service. He was told that the bank had canceled his card and that it was "reassessing risk," he says. He has never missed a payment, monitors his credit score and doesn't carry a balance on any of his credit cards, he says. He ended up paying with another credit card at the restaurant.

If an issuer cancels an account due to customer inactivity, default or delinquency, notification to the cardholder isn't required, according to the Equal Credit Opportunity Act. However, an issuer is required to notify consumers about an account closure if the issuer terminates it based on other factors, such as information from a consumer's credit report. In these cases, like Ms. Horowitz's, written notification is provided within 30 days of—not necessarily prior to—the account's being closed.

New regulations from the Federal Reserve, the first of which go into effect Aug. 20, and rules from Congress that unroll in February 2010 will still permit card issuers to cancel accounts without providing advance notice. The regulations will curb other controversial practices. They will prohibit card issuers from hitting borrowers with an additional fee if they go over the credit limit on their card. Cardholders will also receive 45 days notice in the change of terms, such as an interest rate increase or reduction in credit limit. But the 45 days' notice won't apply to account closures, regulators say.

In recent years, issuers have been closing inactive accounts, or accounts that haven't been used in a year or more, to cut down on risk. If an account is closed because it is deemed "inactive," many issuers, like Bank of America, won't notify the cardholder at all, nor are they required to. BofA says open credit lines are a credit risk to the bank. Other large issuers, like Chase, are doing the same.

Chase says that it is managing potential exposure by evaluating active accounts and closing inactive accounts. "Inactive cards with large open credit lines present a real risk of fraudulent use and large potential liabilities for Chase," the bank said in a statement.

There is new concern that active lines of credit, or lines that have been used within the past year, also pose potential risks to issuers, says John Ulzheimer, head of educational services for Credit.com, a credit-education Web site. Although cancellations aren't directly affected by the new regulations, the reassessment of customers by issuers "is part of the pro-active housekeeping" before new regulations take effect, he says.

Mr. Ulzheimer says he thinks many card issuers are also worried about the unemployment rate, home values and overall tightening of consumer credit. "Issuers depended on these things going up, too," he says.

Also troubling to issuers are rising delinquency rates on consumer credit cards. The credit-card delinquency rate, which measures the percentage of consumers who are 90 or more days delinquent on one or more credit cards, rose to 1.32% at the end of the first quarter of this year, according to credit reporting agency TransUnion, from 0.91% two years earlier.

The ultimate shakeout for consumers can be confusion.

Mallorie Schultz found out that both of her Chase credit cards had been canceled when she called to activate her new cards, bearing her new last name. (She was married in February.)

The accounting-firm office manager in San Diego, Calif., was shocked when Chase customer service told her the two cards, with limits of $1,000 and $2,500, would be closed. She carried a balance of $700 and $1,000 on the cards, respectively, and had used them regularly in the past year. She said she has never missed a payment on either of those cards, or any other. Ms. Schultz is one of 20 million former Washington Mutual credit-card holders who transitioned to Chase after WaMu was purchased last year. The letter she got from Chase listed reasons her account could have been canceled, she says. When she called customer service to find out which specific reason applied to her, she was referred to a credit-reporting agency, she says.

In addition to managing wedding expenses, Ms. Schultz says she has been helping her parents with their bills. Having her lines of credit gone has caused a financial scramble, she says.

[bigbear]

Pentagon Federal Credit Union has introduced its Promise VISA card.

PenFed promises NO FEES.

No annual fee.
No late fees.
No over credit limit fees.
No returned payment fees.
No foreign transaction fees.

[Rail Paul]

Pentagon Federal Credit Union has introduced its Promise VISA card.

PenFed promises NO FEES.

No annual fee.
No late fees.
No over credit limit fees.
No returned payment fees.
No foreign transaction fees.

That's an excellent deal.

[Ron Johnson]

Chase just sent me a letter notifying me that the recent increase in my credit limit to $1,000,000.00 was a typographical error.

[ghostrider]

Pentagon Federal Credit Union has introduced its Promise VISA card.

PenFed promises NO FEES.

No annual fee.
No late fees.
No over credit limit fees.
No returned payment fees.
No foreign transaction fees.

I was going to ask, facetiously, if you had to be a member of the military-industrial complex to qualify. Apparently you really do:

Who We Are
Pentagon Federal Credit Union serves over 950,752 members in the Air Force, Army, Coast Guard, Department of Homeland Security, Department of Defense, defense-related companies, and the Veterans of Foreign Wars. We were federally chartered in 1935 and serve our members worldwide.

[bigbear]

If you have no "military" connection, see post #4 above.

[ghostrider]

Oooh, will they let me run black ops in third-world countries?

[splinky]

Chase just sent me a letter notifying me that the recent increase in my credit limit to $1,000,000.00 was a typographical error.

i hate to think what that mistake and the correction did to your credit score

[bigbear]

Oooh, will they let me run black ops in third-world countries?

Michael Westen? Is that you?

[Rail Paul]

Chase just sent me a letter notifying me that the recent increase in my credit limit to $1,000,000.00 was a typographical error.

i hate to think what that mistake and the correction did to your credit score

It would have done a lot to his lifestyle if he had zipped over, taken a cash advance, and used it to buy another Maserati, a bigger place in Vegas, etc.