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Citi and Amex Changing Terms, Raising Rates and Fees

Written by Nickel - 12 Comments

Editor’s Note:  These offers have expired.

This is just a quick heads up to let you know that both Citi and Amex are revising their cardmember terms and increasing their credit card interest rates and fees. I wrote about this in more detail over at Credit Addict, but here’s the executive summary…

Citi Changes

  • Purchase APR is going up to a minimum of 16.99%
  • Cash advance APR is going up to a minimum of 21.99%
  • Default APR is easier to trigger, and increasing to a minimum of 23.99%
  • Fees for foreign transactions are increasing (new 3% transaction fee)
  • You can opt out of the changes, but they’ll ultimately close your account

Amex Changes

  • Cash advance APR is increasing to Prime + 17.99%
  • Late payment APR is increasing to Prime + 14.99%
  • Default APR is increasing to Prime + 23.99%
  • Foreign transaction fee is increasing to 2.7%

And here are the direct links to the articles, where I’ve transcribed the full text of the letters that I received:

Citibank Change in Cardholder Terms, Rate Increase, and Opt-Out Notice
American Express Change in Cardmember Terms, Rate Increases

Forewarned is forearmed. You should also be on the lookout for credit limit reductions, as you don’t want to trigger any over-limit penalties.

Published on December 1st, 2008
Modified on November 25th, 2013 - 12 Comments
Filed under: Credit Cards

About the author: is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

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12 Responses to “Citi and Amex Changing Terms, Raising Rates and Fees”

  1. 1
    Angie Says:

    Does anyone know if all these credit limit decreases and rate hikes have affected introductory 0% balance transfer and 0% purchase offers?

    I have about 7500 on 0% intro purchase (started sept ‘09). I don’t want to open my bill and see 30% interest on it!

  2. 2
    nickel Says:

    Angie: That’s a good question. As far as I know, these changes apply to their “standard” terms, as outlined in their cardmember agreements, and the promotional offers supercede these rates. If you want to know for certain, I would suggest calling the card issuer.

  3. 3
    Danielle Says:

    Ouch, well at least this finally prompted me to set up a couple of alerts on my Citi card related to available credit. I only have $116 balance, so I doubt it will affect me, except in my FICO score of course.

    The only comfort I am finding in this is that when reading the comments on your “credit addict” site it sounds like there are many getting royally screwed by the reductions in credit limits. For me it is just a minor inconvenience at this time.

  4. 4
    benp Says:

    I got the same letter. My favorite sentence.

    Transaction Fee for Foreign Purchases. We add a fee of 3% of the US dollar amount of each purchase made outside the US wheter made in US dollars or in a foreign currency. This fee is a FINANCE CHARGE

    3% seems pretty steep, especially since they have always been able to take a small cut by choosing a good exchange rate.

  5. 5
    troy Says:

    This is what happens when you play a game where the opponent makes the rules and can change them mid-stream.

    My debit card terms have not changed in years.

  6. 6
    Tim Says:

    @Angie, as with any other contract terms, your 0% bt promo rates remain the same; however, it can change if you do not abide by the terms of the promo (i.e. miss a payment etc).

    @benp: 3% has been near standard for many banks, although the total was 3% with 1% being the V and MC transaction charge. What this really seems to mean is that you will not pay 4% total (3% card issuer, 1% V or MC).

    @Danielle: no one is getting royally screwed, because if they don’t like the terms, they can close the accts and pay off at old rates; they can stop carrying balances, etc. since people can’t self-regulate themselves, creditors are forcing the issue.

    for those with good credit that don’t carry balances, rates are dropping and limits are increasing and 0% bt offers are still plentiful. I continue to get 0% bt offers, even from citi. my limits have just been increased and my rates have just been decreased (my citi is under 10%).

  7. 7
    Double Journey Says:

    I just wrote a post on my blog about the tightening credit card environment. I have a credit card that I don’t use that was closed on me. I called to open it, and they wouldn’t.

    I don’t need the card. I don’t have any credit card debt. I have a really high credit score. Yet the bank is pulling credit from someone like me. Yikes! Things are getting bad.

  8. 8
    Ron Says:

    As the Fed rates go down, the CC rates go up. I know they’re convenient, but somewhere in the future, people will look back and say, “WHAT were we thinking?”

  9. 9
    Patty Says:

    So, have you seen the WSJ article referenced at fatwallet at http://www.fatwallet.com/forums/finance/879603
    Chase is instituting $10 monthly fees starting January and increasing minimums due to 5% of balance from 1% with no option to opt out for some (all eventually?)with existing life of balance transfers in use.

  10. 10
    Tim Says:

    @Patty: the $10/mo fee is for people having carried large balances for 2 or more years; although may not be able to opt out, they can terminate the card and pay under old terms or they can give up their promo rate. seems to me , if you have promo rate and can afford to pay off the card within the promo period, you can afford to pay an increased monthly minimum. it will definitely curb the 0% bt arbitrage game, though, if the monthly min is increased.

  11. 11
    steve Says:

    It is not clear to me that you have the option to opt out and pay on your existing terms. I believe they have the right to just change the terms and if you opt out the whole balance becomes due. At least, that is my understanding.

    I may have to call Chase and find out.

  12. 12
    Tim Says:

    @steve, i think you are correct about opting out, which would cancel your promo rate. there are lots of new changes being announced, so it is really best to read the fine print and ask you creditor. If it isn’t showing in an addendum or on your credit statement, the policy isn’t targeting you. i also wouldn’t call, because I like to have things in writing. I’d send chase a secure email through your online acct.

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