I applied for a GM flexible earnings credit card to replace my HSBC credit card with a high interest rate and annual fee I have had for about 5 years due to less than stellar credit at the time. I wanted to earn rewards for the future purchase of a GM car.
I was approved with a limit of 1750.00 and a cash advance limit of 875.00, less than my original HSBC card but I figured I would ask for a limit increase after a few months of usage. As the card gives rewards based on the amount charged, I started using this card for my everyday purchases with the intentions of paying the balance every month.
After using the card for about two weeks and charging about 450.00, I had a business trip to Phoenix and during the trip I attempted to get a cash advance well below my limit which was denied, I then attempted to pay for my hotel room (550.00) which was also denied. I paid for the room using my AMEX card and immediately contacted HSBC to find out what was going on.
The customer non-support rep said due to the heavy usage on my card there was a hold put on it. Now during the 2 weeks worth of usage I had 8 charges - 2 gas charges, 2 meal charges, a vet charge, upgrade to first-class on my flight to Phoenix and two bartabs.
After verifying all the charges were valid I was transferred to the credit dept and informed that they were reducing my credit limit from 1750 to 556 dollars which was 1.00 more than what was charged to my card at the time, I believe they did this to try to get overlimit fees and then raise my introductory rate of 0.0% to the default rate of 28.99%. The only reason that didn't happen is because a pending gas charge was 75.00 and it was only actually 28.00 and another pending charge from a meal was put through twice, the second one had the tip included and they thought that would put me over my reduced credit limit. A weak attempt at trying to screw me out of a bunch of fees, which is how they make their money.
I immediately cancelled the card and told them to send me a final bill which I paid off immediately. I'm sure what they tried to do is perfectly legal according to the terms of agreement they always send you with the card but talk about unethical business practices! No wonder congress is legislating reforms in the credit card business. I was not terribly disappointed with the level of service with my original HSBC card and I was'nt to concerned with the fact that they were administering the GM card, but after the crap they just tried to pull on me I will never recommend anyone to deal with them again
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