Friday, July 30, 2010

Discover is Dead to Me

I understand that the financial environment has changed and creditors can't be as lenient as they used to be. However. Discover has just been evil to me for the first time ever, and it's bad enough that I won't be using them again for the forseeable future, if ever.

I've been making a lot of purchases recently: airfare to a funeral, mattress, lighting, shipping costs. I use Discover for every in-person expense unless the business doesn't take their card or I pay cash. (I have a MasterCard which is my online card and backup daily card.) I paid off the full balance at the end of June. I set up an automatic payment through my bank to pay at least a minimum, starting in August. I thought I'd covered July and the last time I checked, I had no payment due. Turns out I was wrong, and I missed my payment date by a week. Yeah, I screwed up, but it was an honest mistake and one they're fully equipped to ride out until I take care of it, which based on my history will not take more than a month.

In the past this has no big deal. You pay your outrageous $39 fee, get 20% or higher interest mounting up until it's paid off, and everyone's fine. I've never been more than a month late with a payment in 20 years, and I've never, ever been in default. I have never failed to pay all that I owe, but I have occassionally been a week or three late because I'm not good at keeping track of time. Discover has been a good card for me because they'll take a payment by phone the day the payment is due, and credit the payment that day. They give cash back and don't make me mess around with credits, miles, or whathave you that need to be exchanged for something, it's just cash. On occasion (not often) they'll waive a late fee, even. Their operators are generally helpful. But all of that is not enough to outweigh the latest transgression.

This time, Discover - with a single late payment 7 days overdue - cut off my credit. I called them, put through an automatic payment for the full amount due at the last payment, and spoke to an operator. The operator was not allowed to extend me any credit at all. Not even the $25 I needed to send some packages at the after hours Post Office drop.

Excuse me? I've used your card every week for the last 4 years and have a dozen years credit history with your company. You know (based on my credit report where the last time I checked my score was 798) that I will pay you. And you can't extend me a hundred dollars of credit until I sort out my 7 day late payment that I've already authorized????? Fuck you, Discover Card.

I'm heading up north for a vacation this weekend. And while I always carry two cards, sometimes I pare down and just carry one for a meal or jaunt somewhere. What if I'd been in need of gas or a meal 400 miles from home? What if I'd really had an emergency and needed a small portion of the $8400 of credit I should still have had available? You would have been no help. In fact, you shutting down my credit with no notice could have been way more horrible than me having to spend a half hour in a deserted parking lot with a mobile phone.

I've been an expert credit user for 20 years and I've never run up against this situtation. Did you warn me? I'd argue that you didn't. I try to skim all the "here are upcoming changes to your credit agreement" for at least the highlights and no where did I see "We shut down your credit if your payment is 7 days late". It's possible it was there, but it was not prominent and was mixed in with so many other changes that don't affect me that I didn't/couldn't see it. This one, however, is not a good way to do business. I understand that you don't want to hemorrhage money to someone who won't pay you. But there is nothing in my history with you that would suggest this to be the case. I would understand if you wanted me to call in and ask for an extension or something, and offer only a limited amount. But for me to call in and you to not offer me even $25? Fuck you. You knew you could trust me, but I can't trust you. This is not how credit cards work. You're dead to me, Discover card.

If it turns out that all credit cards now do this, I may be more lenient and go back to using them after a year, because they do have their good points, like not sending bills after the due date. But as I said, I haven't seen this policy being announced. And it could put someone in a rather dangerous situation where they're expecting to be able to pay for something important and can't, with no wiggle room. That's unacceptable.

UPDATE: Just got the bill for this month. My overdue amount was $188.56 which wasn't enough to even charge the full late fee - the fee was "only" $19. This is the month after I paid a $3000+ charge in full. Um. Whatever, assholes. I know Citi probably isn't any better but they haven't cut off my credit for no good cause and I already have their address in my bank bill pay system, so that's what I'm using now.


steve said...

There are visa cards which basically match the discover cash plan (chase signature is mine, but am not in love with chase)

West/CJ said...

That's a pretty bad over-reaction on Discover's part. We've missed a payment or two with our visa (when mom was in the hospital), and they were always fantastic about it. I'd be washing my hands of them, too.

fw2 said...

We accidentally didn't pay one a while ago... they changed the address to one we hadn't lived at in 10yrs and never did get a reason... but they did remove the interest payments for that time period. Luckily there was insurance on it and they covered the min pmt for that time period until they FINALLY notified us 3mths later.

You need a powerline for those big ticket items. Then you can take 3mths or so to pay it back at a much lower rate - don't use it as a crutch, credit people don't like that, but as a temp loan it works well.

They are getting stickier here on loaning money and credit. We've heard many stories.... Personally, those people, shouldn't have been surprised.

CrankyOtter said...

I'm completely freaked out over this. Discover has been my go to company that has maintained sanity in the face of weirdness. But I've never run up against this utter stonewall before. I would understand if the payment was late and I tried to charge the downpayment on a new car or something. I would understand if they made me call in and talk to someone before re-allowing a diminished amount of credit before the check cleared. But if they respond like this, when I could have had a legit reason like being distracted by a funeral and work travel and while the amount isn't trivial, it's less than a third of my limit and something I've paid off easily in the past? They've basically decided that they'll let me carry a card for the joy of it, but that's all it's good for. Either give me credit or don't. Cancel my account even, but give me some freaking warning. Don't let me discover (heh) in the middle of the night that my card is suddenly a worthless piece of plastic.

I'm not sure what a powerline is. But like I said, I have a solid 20 year credit history. With the exception of the BoA card where they reduced my credit line from $55K to $25K because of the recession changing their limit calculations (then sending me a letter explaining how now that I'm earning twice what I did when they originally extended me that credit that it's somehow my fault and not the economy's fault...) I've got solid credit. I have credit limits on several cards from $12K to $27K. All told, probably $100K worth. But for me a *huge* purchase is $1000. So chances of me running into my limits is slim to none except in an emergency, and I've already been warned that even with a high limit they sometimes won't authorize big ticket items. This is something else entirely.

Just for grins - the word verification is mintlit which I first read as minitit.

Up My Mind said...

Have you put your complaint in writing to them? Sometimes I get resolution and better service from then on if I write a letter of complaint to someone higher up than the customer service rep. That really bites that they did that. I'll cross Discover off my list of cards to ever get. :)