Chase Bank is in hot water over low interest rate check loans they issued. A federal judge has reportedly certified a 2009 class action lawsuit against Chase Bank that revolves around promises by Chase bank that provided consumers permanent low interest rates on “check loans” but later forced the customers to increase the rate of the loans. Apparently Chase bank has a different definition of the word ” permanent” than the Webster dictionary. U.S. District Court Judge Maxine M. Chesney certified the class and denied a motion by Chase to strike the complaint.
The plaintiffs in the case claim that they each had a Chase credit card that carried a minimum monthly payment of 2% of the outstanding balance, and that the card included a “credit card check” option which provided a loan with a fixed annual percentage rate (APR) until the balance is paid in full. But here is the problem… in In November 2008, Chase advised some of the plaintiffs that it was raising the minimum monthly payment from 2% to 5%. The lawsuit charges Chase with breaching their Credit Card Card-members agreement.
The lawsuit states “the court’s finding defines the class as all persons who entered into a loan agreement with Chase, whereby Chase promised a fixed APR until the loan balance was paid in full and (I) whose minimum monthly payment was increased by Chase to 5% of the outstanding balance or (ii) who were notified by Chase of a minimum payment increase and subsequently closed their account or agreed to an alternative change in terms”.