Citi - Sears Master Card Review

Citi Bank Sears Master Card is one of the worst credit cards I ever had. The only one that can close to this is Chase. I always pay my bills on time or a week before they are due. I make at least the minimum payment or more and have never went over my credit limit, I have never come close to maxing out my credit limit on any credit card that I have ever had. When President Obama bailed out citi Bank and Chase Bank with our tax payer money (that we actually have to work for years to pay China back, as He borrowed it from them) the first thing they did to fix their financial situations was to start punishing their customers that were in excellent standing with them, by raising their interest rates astronomically. My Sears Master Card went from an interest rate of 10.24% to17.99 %, and this was how they were rewarding their customer of 21 years with an excellent payment history and good credit rating. I asked them to reconsider, by the way this new interest rate would be a variable and my old one was a fixed rate. I then asked then how it was legal for them to change the terms of our agreement since I was never late, I had never went over the limit so I had never done anything on my part to void our contract, you know when you sign up with a credit card company you enter into a contract with them. They then informed they could change the terms of our agreement (changing the word from contract to agreement made it legal, but if I had not repaid then, they would have kept the word contract for court to sue me) any time they wanted by giving me a written notice, so I informed them of something I knew, that I would be OPTING OUT OF THEIR TERMS, which means close my account and they have to keep my interest rate the same until my balance is paid in full. Of course if I should miss a payment they could then change my interest rate to the higher default rate, and then contact my other credit holder and report that I had missed a payment and try to get them to increase my interest rates also. Then they could report me to the credit bureaus and try to ruin my credit. As I never pay my bills late their treats did not bother me and I said CLOSE MY ACCOUNT AND I WILL PASS ON HOW YOU HAVE TREATED ONE OF YOUR BEST CUSTOMERS OF 21YEARS. Then is when the fun has started, I am fully disabled and can no longer work, so I go over each and every bill with a "fine tooth comb", and I would advise every other consumer to start doing so if they do not already do so. I found that Citi Bank Sears Master Card has been charging me interest on an average daily balance that is more money than I actually owe them in total. If you do not understand what this means, they figure your interest by taking your outstanding balance and averaging it daily then times it by your APR which equals this formula the interest rate divided by 30 then times your balance then times 30 and this is how much interest you owe them on the outstanding balance on your account. If this still confuses you they had to change their statements to include the daily interest rates they charge you and it is usually listed at the bottom of your statement or on the second page. This is what you need to check every month, this is also what you should check before you consider any of their so called cheap interest rate deals they offer in attempt to get you to transfer higher balances from other credit cards to theirs. They first of all charge you a 3%transaction fee per transfer, so lets say you want to transfer $2000.00 from a credit card that is charging you 10.24% interest to the one they are offering for 3.99% interest for 1 year. This sound really good to you and you think you are saving a lot of money, when you are actually spending more to transfer the money to the cheaper interest rate, than if you had kept it at the high rate. First they have charged you  $60.00 to transfer the $2000.00, and so now your balance is automatically $2060.00, and the interest on that is approx $98.00 for that 1st year, so it has now cost you $158.00, and if you had just left your balance at the credit card with the higher interest and just paid your minimum payment for that 1one year your interest would have been  $196.00 and that is $38.00. Now you say I would have saved $38.00, but here is the kicker, when you transfer a balance to a credit card, if you already owe them money they will apply all your payments no matter how many you make per month or how much you pay to the lowest interest rate balance you owe them first until it is either paid in full or your low apr period time runs out in which then the balance converts automatically to you higher interest rate. All the while your balance at the higher interest rate continues to accrue interest every month at your higher interest rate until you pay off the other balance. And remember once you get accessed interest it becomes part of your balance and you start paying interest on the interest, this is called compounding. You need to remember the Credit card companies are not your friends, they are in business to make money off of you. You can refer to them as Legal Loan Sharks, as they are okayed by the US Government. So I would pay the extra $38.00 or maybe increase the amount I pay them every month by $5.00, this would help reduce that extra $38.00 in interest you are paying. And if you should get the chance tune in to the Fox New network and listen to the Dave Ramsey show, he is a self taught budget guru and can help you get your finances under control. If you think you are sinking and cannot face tomorrow you can call his office as his is a financial planner and he can arrange to find someone to help you, maybe even today. I took his financial Peace University course, which is a simple budgeting course, and although he did not teach me everything I know, as I used to manage a business for amulti million dollar company, he did teach me how to help others, which was a big help to me. And the Dave says the best credit card is the one you cut up and do not have anymore! I love his show.