If you have a Chase credit card, you will very happy to hear this news...
TODAY, March 1st, Chase implements their new and improved pricing policy for their cardholders as part of their Clear & Simple initiative.
Chase will no longer participate in the common credit card industry practice of raising your interest rate if your credit score drops - i.e., the universal default clause.
People often experience a drop in their credit scores for any number of reasons... one of which is inaccurate, negative information being reported on their credit reports through no fault of their own.
Which happens waaaay too often!
Well, we all know that negative credit report information translates into low credit scores. And that could mean big trouble with the credit card companies who will hike up your interest rate because your credit score dropped, or because there's something negative on your credit reports, even if you have a perfect credit history with them.
Hence the term "universal default."
Well, I, for one, am very excited about Chase not hiking up interest rates as a result of a credit score drop. This is good news for consumers. Hopefully in due time, other credit card companies will start to follow suit.
You can read a little more about this change with Chase in this post I wrote on December 10th 2007 last year.