Released: May 07, 2006

Beware MBNA credit card changes

Source: By David Lazarus, San Francisco Chronicle

When Bank of America’s $35 billion takeover of credit card giant MBNA was completed earlier this year, the bank’s chief exec, Kenneth Lewis, hailed it as “the start of an exciting new era for Bank of America in credit cards.” He said the deal “creates significant opportunities for our combined company.”

And now we know what BofA had in mind.

Millions of MBNA cardholders are receiving notice of voluminous changes to their card agreements, including a slew of higher fees and the introduction of so-called default pricing, which allows MBNA to increase your rate to as much as 25 percent if you’re just a minute late with a single monthly payment.

“I’ve never heard of so many terrible things in a single letter,” said Linda Sherry, a spokeswoman for Consumer Action, a San Francisco consumer group. “This is a lot of things for them to be changing at once.”

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