Capital One Increases Rates by 7%

Capital One, a credit card company that primarily targets low-income borrowers, has increased its interest rates by a whopping 7%.

This will result in some cardholders paying 26.01% on purchases and 29.94% on cash advances, depending on their credit rating.

Capital One defends the rate increase by saying:

“Changes in the credit and lending environment mean that it is now costing us more to lend, and so we are increasing the standard interest rates for some of our customers."

This does not seem like a logical rationale, to further punish customers that are already struggling to make payments and are likely facing a host of other issues, such as unemployment and foreclosures.

Capitol One's decision is yet another reason for consumers with large amounts of debt to consider entering a debt negotiation program and avoid paying unfair and excessive interest rates.

Thanks to The Times UK for the update.