Ask Stacy: Chase Screwed Me. Should I Sue?

Pretty much anyone who has used a bank has, at one time or another, felt screwed. So you’ll probably be able to relate on some level to the following email I received a few weeks back…

Hi Stacy:

Back in 2009, I was one of the Chase credit card customer victims with excellent credit and payment record, when they increased my principal payments from 2-5 percent for my high-balance low-interest “fixed” rate loan. I called and told them I didn’t have a job for about 4 years at the time and wasn’t able to make the increased payments on the “fixed” rate loan they had solicited to me 4-5 years earlier – and I had never missed a payment. Essentially, they said ‘Too bad, you must get the money somewhere and pay the 250-percent increased payments no matter what your situation is.”

Because I was searching for a job, I couldn’t afford to let my excellent credit score be ruined, so I took an early IRA distribution of $30,000 to pay down the Chase loan balance so I could meet Chase’s increased payment demands and maintain the credit score. Otherwise, prospective employers would eliminate me from hiring consideration due to bad credit rating -particularly for the finance jobs I was searching for. This distribution triggered $8,000 in income taxes that never would have been paid except for Chase’s unjustified action against me.

About 90 days later, Chase reversed itself and restored the old loan terms. But it was too late to return the $30,000 into my IRA because IRS only allows 60 days. Chase really screwed me over for no valid reason. I was an excellent customer with excellent credit and they treated me worse than a criminal.

I doubt the $8,000 is an adequate amount for a private civil action that an attorney would be willing to pursue, so I joined a class-action suit. No telling if it will be successful or what (small) portion there might be, and how many years it will take. Even with a favorable outcome – hopefully before I die (I’m 67) – I still suspect I’ll never see a dime of the $8,000 in taxes I was forced to pay due to Chase’s blatant wrongful adverse actions against me.

I would be very grateful if you know of any recourse I could pursue for these taxes.

Thank you,
Sondra

I’m not a lawyer, Sondra, and you should talk to one before deciding. But I wonder if you shouldn’t take your suit to your local small claims court. That’s the technique California resident Heather Peters recently used to win $9,867 from Honda because her Civic didn’t live up the 50 MPG Honda had advertised. You can read about it in this article on MSNBC.

Like you, Heather also could have participated in a class action suit. But it’s one that Honda has proposed settling by paying the lawyers $8.5 million, while giving Civic owners peanuts: $100 to $200 each, plus a $1,000 credit toward a new car.

If you’re interested in learning more about suing in small claims court, Heather even started a website that could help. While most of the information on dontsettlewithhonda.org obviously pertains to Hondas, this page of the site has links to information on filing small claims cases in all 50 states.

But before we lay all blame at the feet of Chase Bank, or Honda for that matter, let’s pause for some personal responsibility…

If mileage was that important to Heather Peters, she should have done additional research before buying a Civic. The Internet is full of reviews and information. And while we don’t know the circumstances behind Sondra’s loan, we should all know that it’s unwise to place our fate in the hands of a bank or any other lender. We should never take out a loan if we’re only capable of making minimum payments. We should all know by now that lenders will do whatever’s necessary to profit at our expense. We should always read the fine print and plan for emergencies.

That being said, Sondra’s got plenty of company. To read more about what Chase did and the comments of nearly 700 consumers similarly affected, check out this article from About.com.

Got more money questions? Browse lots more Ask Stacy answers here.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
12 Ways Retirees Can Earn Passive Income
12 Ways Retirees Can Earn Passive Income

These simple ways of earning income without a lot of active, ongoing effort can stretch your retirement dollars.

16 Affordable Products That Could Save Your Life
16 Affordable Products That Could Save Your Life

You’ll want to order these sometimes surprising products from Amazon ASAP.

2 Costly Rewards Credit Card Mistakes — and How to Fix Them
2 Costly Rewards Credit Card Mistakes — and How to Fix Them

If you commit either of these credit card sins, you are likely losing money every time you use a card. Here’s how to easily right this wrong.

7 Unusual Ways to Declutter Your Home
7 Unusual Ways to Declutter Your Home

Tired of possessions weighing you down? Here are seven ways to declutter painlessly and effectively.

7 Bank Accounts With Extra Perks for Seniors
7 Bank Accounts With Extra Perks for Seniors

These accounts offer exclusive discounts and other perks — including interest — to older customers.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

If You Find This Thrift Shopping, Buy It
If You Find This Thrift Shopping, Buy It

Whether you resell it for a big profit or add it to your own wardrobe, this type of clothing is a hidden steal.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

This Surprise Factor Can Raise Your Risk of Dementia
This Surprise Factor Can Raise Your Risk of Dementia

Nearly half of U.S. residents may face this threat.

Organize Your Home With These 10 Thrift Store Finds
Organize Your Home With These 10 Thrift Store Finds

Resolve to be clutter-free in 2021 with these secondhand purchases.

11 Laws You Could Be Breaking Without Knowing It
11 Laws You Could Be Breaking Without Knowing It

Seriously? Fibbing about the weather is a crime? This and other little-known legal traps await the unwary.

Is This Treatable Condition Causing Your High Blood Pressure?
Is This Treatable Condition Causing Your High Blood Pressure?

Researchers say too many doctors are overlooking this potential source of hypertension.

13 Things Seniors Can Get for Free — or Almost Free
13 Things Seniors Can Get for Free — or Almost Free

There are many ways to get cheap or free services and goods after reaching a certain age.

These Are the 3 Best Used Cars You Can Buy
These Are the 3 Best Used Cars You Can Buy

These vehicles boast reliability, safety and long-lasting value.

Taking a Multivitamin? Here’s Why You Should Reconsider
Taking a Multivitamin? Here’s Why You Should Reconsider

A new study has bad news for the millions of Americans who spend money on multivitamins.

Am I Eligible for My Mother’s Social Security Benefit?
Am I Eligible for My Mother’s Social Security Benefit?

Can an adult daughter tap into her late mother’s benefit?

21 Items to Cut From Your Budget That You Won’t Even Miss
21 Items to Cut From Your Budget That You Won’t Even Miss

Start off the new year by implementing these small-but-smart savings strategies. They’ll soon add up.

Internet Providers Can’t Charge You for This Anymore
Internet Providers Can’t Charge You for This Anymore

Starting this month, your ISP no longer can bill you for this fee.

15 Painless Ways You Can Cut Costs in 2021
15 Painless Ways You Can Cut Costs in 2021

Follow these tips to save, so you’ll have money for things that really matter.

9 Small Expenses That Are Bleeding Your Budget Dry
9 Small Expenses That Are Bleeding Your Budget Dry

Keep more of future paychecks by eliminating these budget-busting unnecessary expenses.

Prepare to Pay More for These 31 Drugs in 2021
Prepare to Pay More for These 31 Drugs in 2021

More than 700 prescription medications have seen price hikes so far this year. Here’s a look at the worst.

5 States Lowering Taxes This Year — and 2 Raising Them
5 States Lowering Taxes This Year — and 2 Raising Them

State personal income tax rates, brackets and deductions just changed in these places.

11 Huge Retirement Costs That Are Often Overlooked
11 Huge Retirement Costs That Are Often Overlooked

Does your retirement budget account for all of these costs?

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.