The "Dave Ramsey" plan by Citibank

**kita** · 11-21-2008, 05:50 PM

Citibank just sent me an offer I don't think I can refuse.
I have been severely underemployed and have just now been able to work on replenishing my baby EF. That should be done in the first week of December.
I have been paying minimum payments while I wait to get my unemployment etc. so my credit hasn't been hit.
Citibank sent me this offer...and I don't really see any downside to it. If you do, let me know...

If I join the program,
They will turn off "the ability to charge credit" to my account.
I must make my minimum payment.
I must make more than the minimum payment for the next four months.
For all payments above minimum they will create a credit equal to 20% of that amount.
That credit will be applied to my account within three billing cycles of the end of the four months.
Statement credit will be limited to no more than $550.
After the application of the statement credit, my credit limit will be lowered by the amount of extra payments and statement credit and then I can charge again, (If I want...)

I swear this is a Dave Ramsey plan with a sweetener. I know that I will have to carry a balance of a little more than my expected statement credit to take full advantage of it, but since they were the first in my snowball plan, I don't see what the downside is...
Unless I have to pay tax on the Statement Credit and I think I would live with that...

**Greebo** · 11-23-2008, 07:38 PM

They're desperate to reduce their outstanding debt. I don't see a downside here except that lowering your credit limit would affect your credit rating.

No, I stand corrected - I still don't see a downside here. This *IS* a DR plan!

**madhen** · 11-23-2008, 07:43 PM

I guess my big question is, if you DON'T make your minimum payment and more the first four months, what happens? I had heard that Citibank, specifically, was raising its interest rates on cc's, so I would read the fine print to make sure this isn't just another ploy to get you to fail, then hike your interest rate up to 30%.

**PrairieRose** · 11-23-2008, 07:55 PM

It sounds like a pretty sweat deal to me, especially coming from a credit card company. I'd probably be all over it.

**57plymouth** · 11-23-2008, 08:16 PM

Sure, why not.

Pay them off, use their money, CLOSE THE ACCOUNT.

**kita** · 11-24-2008, 10:08 PM

I haven't called yet about setting it up, but the fine print says you must make the minimum payment. I didn't think about getting a default rate. I'll ask about that. And it doesn't say anything about the rate staying the same. I guess since I am paying it off completely, if they jack my rate, it is okay...after the plan time. I will ask though.

**Wendy99** · 11-24-2008, 11:34 PM

I agree with madhen .. what happens if you DONT make the payment .. get all the details and read all the small print, if it still sounds good go for it

**kita** · 11-25-2008, 02:20 PM

WOW, I just got my citbank statement. My interest rates are going up...from 8.99% to Prime Plus 9.99% OR 15.99% whichever is greater.
I can opt out of the increase by agreeing when my card exp date is reached that my account will be closed. One way or another, I don't think I will be a Citibank customer in six months or so...

**monkeywrangler71** · 11-25-2008, 02:48 PM

Sounds like Citibank wants to break up with you. You'll get over the hurt eventually

**joyofsix** · 11-25-2008, 03:02 PM

Originally Posted by madhen

I guess my big question is, if you DON'T make your minimum payment and more the first four months, what happens? I had heard that Citibank, specifically, was raising its interest rates on cc's, so I would read the fine print to make sure this isn't just another ploy to get you to fail, then hike your interest rate up to 30%.

What she said.