Her monthly income of $1,100 has taken a huge hit now that her credit card bill has increased more than $400.
"I worry that she's not going to make it or she's going to have to sell her home. And we've looked into that," said Gamble's daughter Carita Marie Gamble.
The elder Gamble said she has always paid her Chase bank bill on time, even if it was just the minimum amount. The Gambles were shocked to learn the interest had increased because the mother had opened a new credit card. The bank told Gamble the new rate was permanent.
Her rate jumped from about 16 percent to more than 26 percent - which resulted in her monthly payment increasing by $400 or more. What kind of balance is she carrying on that card, which resulted in a $400 increase in interest alone? What is she doing running up that kind of balance, when she's living on a fixed income? And perhaps most importantly, why was she applying for a new credit card, prior to the rate jump?
My guess is that she'd maxed out the credit limit on the existing card, meaning she's been using her credit card(s) to live beyond her fixed income, and since she's age 75 she's past the ability to ever pay off the existing balances (except possibly via life insurance).
My Capital One card is 9.17%, the minimum payment due is usually around 3% of the balance. I’m guessing she owes around $10-12K and her minimum payment went from $200 to $600.
Quick and dirty calculations show that her balance is between $30,000 and $40,000. Stop burning up your plastic on $1100 fixed income, Grandma!
What kind of balance is she carrying on that card, which resulted in a $400 increase in interest alone?
My student loans, long since paid off, were at 7.75 percent, and I paid $6.60 per $1,000 borrowed each month. So 10% would be about $8.50 per thousand per month. If her monthly interest INCREASED $400.00 due to a 10% rise in her interest rate, her balance was about [pause to pull up the calculator] $47,000.
Those were my exact thoughts when I saw this segment yesterday. How can one blame the CC company when a woman, who is already carrying much more debt than she can afford, goes out and applies for another card? This is a red alert that the company’s balance will not get paid, hence the increased interest rate.
I think that she’s carrying about $20000 worth.
$20K @ 26% for 20 years = $435/month
Well, 10% divided by 12 months is 0.00833/month. $400/month divided by 0.00833 is a $48k balance. Here’s betting Granny has some really cool rims on her Esplande. Rock on Granny!!!