Household Bank - a disaster for consumers
Written: Jan 18 '01 (Updated Feb 22 '01)
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Pros: HB will grant credit to ANYONE!
Cons: high interest rates, late posting of payments, outrageous fees, horrible "customer service"
The Bottom Line: This is the kind of credit card company that gives the others a bad name. Stay away!
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| ritafp's Full Review: Household Bank Credit Card |
Household Bank (HB), which is part of Household Credit Services (HCS) and which is related to the Household Retail Services Inc. (HRSI) which administers numerous house brand credit cards (Best Buy, Filenes Basement, etc.) is such an awful company to do business with that I felt compelled to write this review and warn others.
I took out an HCS Visa credit card in 1992, attracted to a low teaser rate and a high credit line. I transferred balances to this account. Eventually, the charge card was changed to HB. I was often annoyed by the late posting of payments; checks often took 10 days to be posted. Even when I switched to a computerized bill payer service (HomeLink by Fleet), it would often take HCS a week or more to post a payment. Payments were often not posted even when my bank showed the check as already cleared. These delays sometimes led to late payment charges. Finally, I took a hard look at the fact that HB had been raising my interest rate as my balance got higher. When HB's interest rate hit 23.9% even as I was being offered teaser rates as low as 2.9% and regular rates of 8.9%, I contacted HB to see if they would lower my interest rate. In a conversation with a poorly informed, rude customer service representative, they informed me that they would not. Even though I had excellent credit (owned a home, no late payments, reasonable balances), I was denied. I am not convinced that my denial was not based in zip-code "profiling," that is, the denial of benefits to customers/applicants who live in less upscale areas as defined by zip code. I asked for a payoff balance and immediately had the money sent to them (some by me and some from the credit card company I was transferring the balance to). I included a letter with my payment stating that I wanted the account closed when the balance was paid. The payments posted within 48 hours! I called again to confirm that the balance was paid in full; I was informed that it was. I then received a letter from HB closing the account. I checked the credit bureaus and they showed the account as closed by consumer/never paid late. I thought my minor ordeal with HCS/HB was over. Of course, I was wrong.
More than month later, I received a bill for interest in the amount of $54.00. Interest!! How could I have interest on an account that had been paid in full and closed over a month ago? I contacted HCS Customer Service (a more inaccurate label could not exist). They were unable to explain it. I wrote to the company. Two months later (with late fees and more interest added) they told me that the interest was due to interest on a cash advance from years ago. The explanation made no sense to me and I informed them that I was refusing to pay the money or any additional charges on this account. I sent away for copies of my credit report from the Big Three - Experian, Equifax and Trans Union (In Massachusetts, consumers are entitled to one free copy every year, so I make sure to get a copy each year.) In checking the reports from Equifax and Experian, I noted that HCS was reporting my account as closed by the consumer and 120 days overdue! I immediately wrote to HCS, Equifax and Experian disputing this. But the clincher came when I received my Trans Union profile and saw that HCS was reporting that the account was closed by the company and was 150 days overdue! This was an outright lie. Then I got a letter from another credit card company increasing my interest rate on their card because of negative information on my credit report. The negative information was the 150 day delinquency from HCS. I was furious! Although the second credit card company was willing to forgo any increase for four months while I got my credit profile cleaned up, I was denied a credit line increase from my bank based on HCS's notation on my credit profile. Following the advice of netkat on Epinions, I wrote to HCS's CEO, Bobby Mehta, and made it clear that I was planning on filing a complaint with the Office of the Comptroller of the Currency (OCC), as well as the Better Business Bureau (BBB). I also discovered a group developing a class action suit against HCS.
The responses to my letters say a lot about HCS. The first letter, sent to the Customer Service Department, was returned a month later with a form letter saying that they could not identify the account (I had used the scrambled account number from the Equifax report) What?! They couldn't look it up by name?! The second letter which went to the CEO, with the same information on the account number, garnered a phone call within a week. The person calling was able to pull up my record on the computer during the conversation. She offered the same lame excuse I had received previously about the interest and when it was clear I wasn't buying it, offered to absolve the charges and correct the credit bureau notations. I agreed. Of course, I asked for that in writing.
HCS charges exorbitant interest knowing that many of its customers (it markets to lower income customers) cannot go elsewhere, and provides poor service, particularly when in comes to the timely posting of payments, which causes customers to incur late charges. Its customer service reps are among the most poorly trained and are uniformly impolite. Perhaps most annoyingly, HCS seems to provide a consistently poor level of service and then respond to complaints based upon its perception of how much trouble the complainer might be rather than based on the correctness of its policies.
UPDATE - February 22, 2001
I asked for a letter from Household Bank affirming the absolving of charges and change to a positive credit notation. I received it and faxed it to the big three credit bureaus. When Trans Union failed to make any change, I contacted them by phone. They informed me that the letter was dated January 2000 (not 2001) and therefore pre-dated the problem and they would not accept it as proof that the problem with Household Bank had been resolved. The body of the letter contains two references to dates in January 2001, but the dating of the letter was obviously one of those new year's mistakes. But now I have to get a new letter from Household and re-fax it to the credit bureaus. In the meantime, my credit profile shows this negative notation. I wish I could lower my rating of Household Bank to zero stars!!
Recommended:
No
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Epinions.com ID:
ritafp
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Reviews written: 52
Trusted by: 4 members
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