Citibank and Other Credit Card Companies Raising Interest Rates

I have had excellent credit history for over 30 years, and have had a Sears Citi Bank Gold Master Card for several years. I have NEVER been late with a payment, nor have I with any other cards or to any other creditors.
I have carried only a small amount on this card-in the $4,000-5,000 range and in recent years the interest rate has been raised to 23.24%, fairly high considering my credit history. But I haven't complained, feeling it probably wouldn't do any good to even request a rate reduction.
About four months ago (end of 07/09), I changed my personal bank. However, I had several checks I had sent out about a week prior to closing my old account. Due to an error on my part, I failed to keep my old account open in order to cover any checks that had not yet been processed. I had sent out payment for my Sears card bill about a week before it was due (and about a week before I closed my old account). I realized the error the day I closed the account....that the Sears check had not been processed yet. This was on a Friday night, and the Sears bill was due within a couple of days.
I called Citi Bank that evening and explained the situation. I appologized and told them I would gladly overnight them a check first thing the next morning, and they would have it Monday morning. They told me flat out that they wouldn't be able to stop the old checking account check from going through, and that I would just have to take my chances on which check tried to clear first. Of course, needless to say, they received the check on the closed account before the overnight was received. And despite my pleadings with them, I discovered on the next month's bill that because the payment was late, I was now considered to be "in default" on my account. As a result, my interest rate was raised to 29.99 percent. I didn't even realize banks would charge such a rate to people who had shaky credit history.
I have made two seperate requests to have this rate reduced. I did so immediately upon receiving notice, on a phone call to customer service. I received a letter a week or two later denying the request because again, my account was in default.
On the first bill I received after this issue, I mailed them a payment of $800, followed by a $300 payment last month. My only intention now is pay off my account as quickly as possible and close the account.
I phoned customer service again this week, and told my story to a representative who said that yes, he thought this rate could be reduced. He transferred me to a supervisor who informed me that because I had a late payment, the rate could not be reduced until I made 12 consecutive months of on-time payments. I imagine my account will be long closed before that time.
As a way to try to embarrass the supervisor, I of course mentioned the government bail out the banks received, the ridiculously low interest rates they are required to pay back the loans at, and asked if they have any concience taking these sort of actions against customers. The supervisor pretty much said they have every legal right to raise the rates as they see fit. He was talking to me as if I was someone who had actually defaulted on a loan...a deadbeat...as opposed to someone who has religiously had exceptional credit history.
This experience has left such a sour taste with me that I have refused to EVER step foot into a Sears store again. I realize it may not be Sears making these decisions, but they have contracted with this company to provide financial services. The way I see it, they are responsible for any actions of Citi Bank, the same as if they made these decisions on their own.
I want to cancel my account right this moment. My question is, what is the best way to do so. Should I wait til my account is paid off? If I cancel my account now, with a remaining balance, are they going to demand immediate payment? Will they increase my interest even further...to say 40 or 50 percent? They seem to have communicated to me they have a legal right to pretty much do as they please. And if I cancel the account now, are they going to take any action that would damage my credit history? I imagine their decision to place my account in default hasn't helped me in that area.
Any suggestions would be appreciated.

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This interest rate increase is going to put me into Charter 7 or 11. I cannot believe Citi is doing this to Customers, especially with this economic state. I have been with them for over 10 years, and they are saying that they cannot do anything about it.

I received the same letter stating that my rate would be going up. There was instruction on opting out of the rate hike by closing the account. My letter was inadvertently thrown away. Can anyone point me to where I can go online or what number to call to opt out...and the cut off date for opting out.

You can call the phone number on the back of you card. Not sure of the cutt off date tho cuz it might be different for different customers, mine is today Jan 4, 2010. Hope this helps.

In November, Citicard notified me that my APR would be raised to 29.99% on any remaining balance after 11-30-2009. I was given the opportunity to "Opt Out", meaning that my APR would remain the same, but I would be unable to use the card and my account would be closed. I chose to "Opt Out" on both my accounts (Citicard and AT&T Universal Card) to avoid the higher interest rate.

I reviewed my December bill and found that my APR
was raised to 29.99%. I contacted customer service,
and they said that they had no record of my choosing to "Opt Out".

I believe this is just another attempt at a big business bailed out by the government to gouge
customers that have no voice or avenues to pursue to make them keep to the contract they offered.

I hope someone will hold them accountable and make them refund all the customers they have defrauded.

I read the December 3, 2007 Senate Credit Card Hearing to Focus on Unfair Interest Rate paper, where Senator Levin and other senators were able to bring credit card companies to task for unfair increases in customer's interest rates. Hopefully this will happen again.

WRITE YOUR POLITICIANS NOW!

CITI BANK, ALSO HAS HOME DEPOT, AT&T, THEY SAID THEY SENT ME A LETTER ON THE INTEREST RATE RAP -OFF AT&T NEVER SENT NOTHING, I CALL EVERY MONTH TO OPT-OUT. THEY SAID I DIDN'T HAS THAT OPTION, JUST THIS MONTH THEY RAP ME A 28.99, BUT IF YOU THINK ABOUT. IF EVERYONE OPT-OUT AT THE LOW INT. RATE, THEY WOULDN'T GET THAT CASH FLOW THERE LOOKING FOR, THAT WHY THERE F ---- EVERYONE ITS ALL A BIG RAP OFF. I CAN'T BELIVE OBAMAN IS LETING THEM GET AWAY WITH THIS, IF WE COULD GET ABOUT 500.000 CARD HOLDER TO NOT PAY UNTIL THEY LOW THE RATE, I THINK WE WOULD BREAK CITI , OR BOY-CUT HOME DEPOT OR ALL CITI BUSINESS

Yep, stellar credit...never late. Also, one of the higher interest cards I have but use often since I have a high credit usage(as a platinum member). I used often for building houses for the perks of auto purchases. Obviously not worth it now that I will be at 19.99% whereas my other cards are at 6.75% (MBNA Platinum). Sorry but I am not at fault for the losses and HIGH CEO rates paid to keep this card any longer. Think TWICE CITI as you will see a lot more customers leaving and/or defaulting/bankruptcy. See Ya Citi...it was nice ride even though rates were higher than should be.
Sean Thibert

this is just highway robbery to the american taxpayer.i have used credit cards to help me in business.i owe out a good amount of cash myself.not that i abused the privilege,the last 3 years have really been tough on small business.i have never been late a payment at all,i always pay more than the minimun.but this is corruption,in its highest form.those bas .get bailed out with our money,and this is the thanks we get.i made my mind up.over 1/2 of my home is already paid for,so im going to roll my money,into my mortgage,at 3.5 percent.refinance,and never use their cards again.beleive me,millions of people will do this,and do they realize how much business they will lose?many people will now use debit,instead of credit cards.the effect will be felt in the long run.they ship our jobs over seas.so why cant we do business with foreign banks?wait until members of congress want to be re elected.hope they remember this,sign a petition agaist this online to congress.more people are doing just that.remember we can do something about it,if we stick together.so everyone hop on board,and sign the petition online against banks doing this,against the taxpayer who bailed them out.remember united we stand.there is more of us than them.dont give up the fight.im old school,and im not changing.sign on and we will get our message through.we changed the seat in massachuttes,and we are not stopping.not many people in washington thought brown had a chance,but he heard the people.we need more like him.theres a will,theres always a way.these big banks forget,what goes around comes around.and i do beleive in kama.bill

I have used Citibank for 23 years. I've had balances and paid them off.I've always paid on time and even paid extra when I could. Our balance on the card was high at this time but not any where near my limit. They raised me from 13% to 29%, which upped my monthly payment. I called them and told them that I could not make that payment at this time but I was offering to pay my normal payment I was making before, due to taking a pay cut and my work hours were cut. I told them that It would only be temporary until I get my hours back and I was also looking to work a second job. They told me they were sympathetic to my situation but they could not help me right now. So 23 years with Citibank has now ended, as I closed my account with them. But they also told me that now my account will not be protected by them either. I am selling my house and I will be paying them off soon. I will never do business with them again.