Tilted Forum Project Discussion Community - Finance Charges on a closed account

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Finance Charges on a closed account

We recently paid off our balance in full on a Chase credit card. The balance was ~$6000. We called and got "today's payoff amount" from a billing rep. We paid that amount. We waited one week and called to close the account. We had overpaid our balance by $20 and they closed the account and mailed out a check for that $20.

Today we got a statement for $72.20 worth of finance charges that were apparently accrued on the average daily balance of ~$2300.

Personally, I think this is bullshit. If they do NOT calculate finance charges daily (I know some banks do), why would they refund our negative balance before the end of that period? If they DO calulate it daily, they are trying to screw us. Does anyone have insight into how to not pay this? Frankly, when I've closed accounts (loans, credit cards) in the past, I've paid of the "today's payoff amount" and been 100% done with it. I've never had a situation like this come up. Frankly, Chase sucks pretty bad, and I don't believe that I owe them this money. However, I'd rather not have this on my credit report. What options do I have? I'm not above threatening them with legal action. In fact, I'd almost be willing to PAY a lawyer a few hundred bucks to file appropriate paperwork rather than give Chase $72.20 I do not owe them.

Thanks in advance for any help!

I ran into the same situation with Chase a few years ago and ended up just paying to get them out of my hair. I decided henceforth to wire funds or otherwise pay electronically and close the charge account same day, and have done so twice.

Not to say that is the only solution. It likely depends on the specific cardholder agreement and the dates of money transfers. I look forward to reading about what you learn.

From http://www.consumeraffairs.com/credi...dit_cards.html

Quote:

Charlie of Manassas VA (11/26/05)
I called Chase credit card company asked them to close out my account and asked for a payoff balance at that time I was told $16311.53 I told them I would be paying it off in 10 days, which I did. Then they sent me a bill saying that I owe $506.11, which I have been disputing, today I got a bill for $740.29 because they charged me a $231.51 finance charge on top of the $506.11 that they say I owe. I paid the payoff balance that I was told, within the time frame that I told them and closed the account. So how can I owe this momey?

That page lists MANY such issues, but this one happens to be just like mine. I understand that credit companies are in it to make money, but I don't think being deceitful is the answer. Perhaps I can threaten to get a law firm to look into a class action lawsuit against them for such practices. It won't help others, but maybe it'll get me off the hook. I won't screw up my credit, but unless there are ZERO other ways about it, I will not give them any money they aren't owed.

When Chase was Bank One, they decided I owed $400 to them, and I disagreed. (Long story; short version is I was agressive about their refusal to issue a frequent flier ticket I was entitled to.)

If my experience is any indication, they will ignore whatever you tell them, and if you don't pay, they will report you to one of several really scummy collection agencies. These guys will lie and scream at you on the phone. Now that I have experienced this, I would be prepared to handle it with much more aplomb--I'd alternate between talking dirty ("So what are you wearing, Sweetpants?") to the collector and calling him an inbred cretin. Unfortunately, neither Bank One or the collection agency had an office in my state, so I couldn't get them into small claims court.

Long story was I held off for four years, but then interest rates dropped so much I wanted to re-fi my house at 4.65%. My wife paid them behind my back, because she was afraid I'd refuse to, and ruin the chances of getting that rate.

But I would do pretty much anything in my power to get back at those thieves.

P.S. I have paid things Cyrnel's way without a problem. I think immediate payment is critical.

Did you notice this?

http://www.consumeraffairs.com/news0...rilegiant.html

Quote:

California Sues Chase, Trilegiant

July 12, 2005
California Attorney General Bill Lockyer has filed a lawsuit against Chase Bank and Trilegiant Corp. alleging the defendants unlawfully deceived tens of thousands of California consumers into paying for membership programs that purportedly provided discounts on car and home repair, shopping, and other goods and services.

Trilegiant
• Inside Trilegiant's Marketing Machine
• Connecticut Sues Trilegiant
• California Sues Chase, Trilegiant
• Trilegiant Settles with Florida
• About Trilegiant
• Consumer Complaints
"In colluding to perpetrate this unsavory scheme, Chase and Trilegiant preyed on vulnerable senior citizens and consumers who read and speak limited English," said Lockyer. "After tricking victims into joining these membership programs, the defendants used deceptive billing practices to maintain their ill-gotten income stream. We're filing this lawsuit to make the victims whole and obtain penalties to hold the companies accountable."

Earlier this year, Trilegiant paid the state of Florida $400,000 in restitution and agreed to provide compensation to consumers wronged by the company's tactics in marketing various club memberships. The company marketed the memberships to Florida consumers in a variety of manners, none of which was ever clearly disclosed, prosecutors said. Some 40 such clubs were marketed, including Buyer's Advantage, Traveler's Advantage and Complete Home.

Filed in San Diego County Superior Court, Lockyer's complaint alleges Chase, Trilegiant and other defendants violated California laws that prohibit false or deceptive advertising and unfair business practices. The number of California victims is not specified in the complaint, but Lockyer's office said the total reached into the tens of thousands.

The complaint seeks restitution for victims, civil penalties of $2,500 per unlawful act, an additional $2,500 penalty for each violation that victimized seniors, and an order permanently barring the defendants from engaging in the alleged practices.

Cendant Corp. in January 2004 changed the name of one of its subsidiaries to Trilegiant Corp., according to the complaint. The subsidiary, the complaint alleges, continued the membership scheme under that name. Cendant, which had an ownership stake in Trilegiant Corp. prior to January 2004, is not named as a defendant in the lawsuit.

The complaint alleges Chase and Trilegiant enter agreements under which Trilegiant gains access to Chase's customers for the purpose of marketing the membership programs. In soliciting Chase customers, Trilegiant uses Chase's name, and Chase reviews and approves marketing materials used by Trilegiant, according to the complaint. On occasion, the complaint alleges, Chase includes the solicitations in its customers' monthly statements.

"Chase receives substantial compensation for its participation in this marketing scheme, including commissions on initial sales and automatic renewals of Trilegiant's products and services to Chase customers," according to the complaint.

The defendants' solicitations offer consumers "free" trial memberships in discount purchasing programs, the complaint alleges, without adequately informing consumers they will be billed automatically for a one-year membership if they do not affirmatively cancel with a specified period time. Typically, the cancellation period is 30 days.

The solicitations include checks that consumers are urged to cash as a "reward for being a valued Chase customer," the complaint alleges. The defendants do not adequately disclose to consumers that if they cash the checks, they automatically become members in the discount buying program, and will be billed for a one-year membership if they do not cancel by the specified deadline, according to the complaint.

"Consumers are unaware that Chase allows Trilegiant to charge fees to consumers' Chase bank accounts or add the fees to their Chase monthly mortgage statements, merely upon the consumer cashing a ‘reward' check or accepting a ‘free' trial offer," the complaint alleges.

The annual membership fee ranges from $69.99 to $119.88, the complaint alleges. The defendants fail to adequately disclose the membership will be renewed every year unless the consumer affirmatively cancels, according to the complaint.

However, the defendants' deceptive billing practices make it difficult for consumers to know they are members, or are paying for a membership. "Consumers do not realize they have been billed for such membership services because the membership fees are sometimes described as ‘Optional Products' or described in a manner that does not clearly identify the particular membership program, seller or nature of the charge," the complaint alleges.

The alleged scheme has hit hardest some of the most vulnerable consumers, according to the complaint. "Through this marketing scheme, (the) defendants prey on consumers, many of whom are unsophisticated, elderly or do not read or speak English as a first language," the complaint alleges.

The membership programs offer purported discounts on a variety of goods and services, including car maintenance, home repair, car rentals, travel services, shopping and pet products, according to the complaint.

The programs are marketed under the following names: AutoVantage, AutoVantage Gold, Travelers Advantage, Complete Home, Shoppers Advantage, Buyers Advantage, Pet Privileges and Just for Me.

California consumers who believe they have been victimized by the scheme alleged in the lawsuit, or similar membership programs, should contact the Attorney General's Office at www.ag.ca.gov/consumers/mailform.htm or by writing to the Public Inquiry Unit of the Attorney General's Office at P.O. Box 944255, Sacramento, CA 94244-2550.

I agree, and they were paid electronically that day. Also, I did, in fact, see the above article. It's a bit of a different situation, but still, they seem to be getting some bad press lately (as has Bank One). I wonder if JP Morgan ever regrets the additiona they made to the banking family. *sigh*

I closed an account once with a letter. I settled the small remaining amount as requested and made it quite clear that I would not be treating seriously any later mention of fees for a the closed account. I kept a copy of the letter as well as mailing myself a third version (for the date-stamp) which I kept sealed as proof.

I think I did get one additional mail. I just put them in a pile (it was a small amount) and they went away. Guess it costs them more to chase than to retire it.

I have 2 chase cards. I will never use either of these cards again.

1 had a 3000 limit on it, with 13% interest, another was 4500 with 10%. About 2 or 3 months after i transferred balances to the 4500 card, I got a letter in the mail stating that they were moving my interest rate on both cards to 29%. There was no additional information on how their decision was based.

So, I called them up and they told me that they pulled my credit and I "fell out of the range" that i was in when I got the cards.

When I got my first chase card, my credit score was around 600. When I got the second one, it was around 660. It was over 700 when they decided this... I called that night and paid off those 2 cards and told them I'd never do business with them again over this.