Earlier this week, I recieved a notice in the mail from Household Bank, with whom I had a credit card account. It served as a perfect motivation to reduce my number of cards by one, so today, I called them up.

The notice read as follows:

Effective July 1, 2005, the following sections of your Agreement will be amended as set forth below. These amendments will apply to new and existing balances on your Account.

[...]

WE MAY CHANGE OR TERMINATE ALL OR ANY PART OF THIS AGREEMENT, OR ADD NEW TERMS AT ANY TIME, INCLUDING WITHOUT LIMITATION ADDING OR INCREASING FEES, INCREASING YOUR PERIODIC PAYMENT AND INCREASING THE RATE OR AMOUNT OF FINANCE CHARGE, OR CHANGING THE METHOD OF COMPUTING THE BALANCE UPON WHICH FINANCE CHARGES ARE ASSESSED. AMONG OTHER THINGS, WE MAY UNILATERALLY INCREASE YOUR APR, INCREASE FEES OR TAKE OTHER ACTION TO INCREASE THE COST OF CREDIT BASED ON A CHANGE IN YOUR CREDIT HISTORY, INCLUDING YOUR FAILURE TO MAKE TIMELY PAYMENTS TO ANOTHER CREDITOR OR US, AN INCREASE IN YOUR TOTAL OUTSTANDING DEBT, OR AN INCREASE IN THE USE OF YOUR CREDIT LINES.

Ok, I've seen some outrageous things, but this one takes the cake. Unilaterally adding or increasing fees? Is there any sane person in the world who would knowingly agree to such terms, especially given Household Bank's particular history of not acknowledging receipt of payments until several days after they've been received? (The latter of which I only found out about recently when I watched Frontline.)

So today, I called their customer service number, and after navigating through the menus, I got to speak to a representative. (Funny how none of the automated push button menus include the option to cancel the card.) I asked that my account be canceled. (I haven't even made a charge on that card since last year, so it's not as if I'm going to miss it anyway.)

When she asked for the reason I wanted to close the account, I read the above notice verbatim over the phone, and then asked, "Do you think this sounds like a reasonable deal?" (I'm generally not big on heckling low level customer service drones regarding issues that are utterly beyond their control, but I think I was as polite as I could be given the circumstances.)

She said, "Well those fees only occur when you don't make payments on time or go into default."

Neverminding the fact that the legaleze contains no clause specifying that the unilateral fee changes and additions are restricted to accounts that are late or in default, I said, "Even if that's the case, the amount of the fees should still be agreed upon beforehand. I don't think it's reasonable for you to be able to change the amount of fees to whatever you want after the fact."

Eventually, after trying to convince me to keep the account open in case of emergencies (the last thing I'd want in the case of an emergency is extra unknown fees to worry about), she said the account would be closed.

Well, that's one less piece of plastic to worry about.

If there were any sanity to our laws, such amendments to a contract's terms would be legally null and void without a signed agreement returned by the customer. Notices thrown in with the junk mail don't cut it. But instead, congress concerns itself with passing "bankruptcy reform". What a topsy turvy world we live in.

In a way though, I'm glad, because it gave me an excuse to do what I wanted to do anyway. One down, four to go. (Or is it five? The fact that I don't even remember exactly how many cards I have stuffed away in envelopes means I have way too many. Oh well.)