Vision Credit Education, Inc.

Chase has announced that they will be converting Washington Mutual (WAMU) credit cards over to Chase credit cards in March 2009. If you have a WAMU account, you can expect to receive a new Chase card to replace your existing card account. If your WAMU account has a special balance transfer rate, you could see some big changes!

Your account number will not change which will maintain the extended reporting period for seasoned accounts. It will be the same account number and will show up as the same account with a different creditor name on your credit report.

While there has been no indication if the terms will change to align with those of other Chase accounts, it is likely that this will occur. What we do not know is if WAMU account holders that took advantage of balance transfer offers will be subject to similar monthly service fees, interest rate increases or 5% minimum payment requirements that caught other Chase account holders off guard.

This could indeed be a startling event for WAMU cardholders that have taken advantage of balance transfer offers in the past. Your minimum payment could go up dramatically.

Consider that your current monthly payment is normally around 2 or 3%. On a $10,000 balance this equates to a $200 or $300 monthly payment. If terms are updated to match those of some Chase accounts, your minimum payment could jump to $500 each month.

Some families have a healthy surplus in their budget that allows them to absorb the higher monthly payment. This could put a pinch in their budget, but it could also force a more rapid repayment which would begin to lower the balance at a faster rate.

Many families already are dealing with higher costs and lower incomes. Some are at a break even, while others are already falling behind. An extra $100-300 in monthly payouts is enough to push many families over the edge.

Some WAMU cardholders have already reported that they have received revised terms on their existing accounts. We have not however, received any confirmation that balance transfers will be subjected to the revised terms of many Chase cardholders.

Chase has simply stated that payment processing currently handled by WAMU will be aligned with Chase’s current policies and processes effective Monday, March 9, 2009. That implies that existing WAMU balance transfers may be subject to changes in terms that have rankled some Chase cardholders.