Invoke Title 15 U.S. Code § 1637 on Barclays Gold?

There is a well documented loophole some users of the Chase Ritz Carton Card have reduced their credit limits to $1,000 in order to grant themselves a fee waiver, for at least the first year. The loophole has been documented working here, here and here. The way it works is in the 15 U.S. Code § 1637 a credit card cannot charge more than 25% of the credit card in fees. It specifies:

If the terms of a credit card account under an open end consumer credit plan require the payment of any fees (other than any late fee, over-the-limit fee, or fee for a payment returned for insufficient funds) by the consumer in the first year during which the account is opened in an aggregate amount in excess of 25 percent of the total amount of credit authorized under the account when the account is opened, no payment of any fees (other than any late fee, over-the-limit fee, or fee for a payment returned for insufficient funds) may be made from the credit made available under the terms of the account.
Now that Barclays is charging the $995 for everyone it might be possible to lower your credit limit below $3,980 in order to invoke the consumer credit protection law. This can be done by shifting a credit limit back to other Barclay cards on the account such as the Arrival+ or even the AAdvantage Silver or Red.
Now I certainly don’t have the balls to do this, yet. If Barclays doesn’t go the safe route like Chase, then your stuck paying the $995. Chase chose to waive the fee because they did not want any legal challenges brought up against them.
Shitty bank (Citibank) is smart by not allowing the credit limit to be lower than 4 times the annual fee. Not sure if Barclays is aware of this rule, but could do the same thing. However, I wanted anyone of you readers to become the datapoint that you want to see. The $200 a year credit would certainly be a benefit, but again this law may only apply for the first year of a fee being charged. Not sure if it would count for the many others that had their first year waived.
Just a thought, let me know if you have any success.
-Derp

One Response to Invoke Title 15 U.S. Code § 1637 on Barclays Gold?

  1. i did this when the gold card first came out (i’m non military). i got the limit down to 1500 and they refunded a proportional amount of the fee (~625). didnt wait around to see what would happen year 2.

Leave a Reply

Your email address will not be published. Required fields are marked *