Direct Merchants Bank

Collection Policies

Direct Merchants Bank •Application Fees •Change of Address Policy •Collection Policies •Customer Service •"Credit Protection" •Interest Rates •Late Fees • Late Posting of Payments •Over-Limit Fees •Preying on the Disabled • "Rate Reward" •Secured Credit Cards •Security Policies •Disappearing Funds •Telemarketers •An Insider's View

Kelly of Scottsboro AL (5/25/04):
I have been behind on my payments but have recently started making regular on-time payments to Direct Merchants Bank. I pay the bill now as soon as I get it in the mail. Still they are harrassing me at work and calling my house 5 or 6 times a day. Why are they allowed to keep doing this to me? I am a single mother who had health problems over the past couple of years and am just now getting to where I can pay all of my bills on time. What can I do to stop them from harrassing me?

They have made me afraid to answer my phone at home and my boss is getting tired of them calling me at work.

Unfortunately, there's not much Kelly can do. The Fair Debt Collection Practices Act applies to collection agencies but not to the business to whom the debt is owed.

Angel of Modesto CA writes (2/12/03):
In 1997, I applied for a credit card with the Phi Theta Kappa International Honor Society. After about two years, I received a new card in the mail which said Direct Rewards and later found out that my Phi Theta Kappa credit card had changed to a Direct Rewards card through Direct Merchants Bank. Prior to this change, things were fine with the credit card service, but after Direct Merchants Bank took over, things got nasty.

First, I started noticing that I was being charged a monthly service fee (which was nearly $60) and so this made it difficult for me to pay my balance off with my minimally required payments of $40.00 per month. Also, I recently consolidated all of my credit card bills through a consolidation agency. Through this arrangement, I send payments in to the agency and they distribute payments electronically to all of my creditors. Well, due to the Holiday mail delays during Christmas, my payment was received late by the consolidation company which meant they had to pay Direct Merchants Bank and my other creditors about five days late. The other creditors did not make a big fuse over the situation, but of course, Direct Merchants did.

Ever since my payment was received late, they dropped me from the consolidation program, and have resumed to harrassing me by phone every five days. And they love to ruin my Saturday mornings by calling constantly starting at 8:00 a.m. Their representatives talk very nasty and seem to think they can just order me to pay the entire balance in full over the phone. Being a college student who does not have much money, this is a very stressful situation. Unlike most college students, I have been very responsible with my credit cards and do not use them for shopping. Instead, I have only used my credit cards to purchase books and plane tickets to get home.

I have made every effort to pay Direct Merchants on a timely basis and deal with them fairly, but unfortunately, they have not shown me the same respect. I cannot wait until I graduate this semester and start working full-time. The first thing on my to do list is pay Direct Merchants Bank off in full and never do business with them again. I wouldn't recommend them to anyone.

Lisa of Portland (2/3/03):
I am a recent divored mom w/4 small chilern on state help. I had nothing but trouble with this business. They had pressured me by numerous phone calls because of one late payment. I am trying to work them about the fact that my life is not great for me now. This company takes advantage of people like me without any options. They pressured me to do a bank direct payment and still the amount minimum was so high. I am stressed out so much that I don't sleep, eat or leave my house. The fact they can play God hurts. On Nov. 19, 2000, Jeffrey of Olympia, WA, wrote:
I was called on 13 Nov 00 that my account was overdue $450.00 and could I make a payment. On 15 Nov 00 I sent a $490.00 payment to bring my account under its limit. I called today and was told I still owed $318.00 on my account. When I asked how this could be, they explained that these were over-limit and late fees. When I asked why my bill did not reflect this she replied that the money I sent was to catch up the payments!

All she could say was you have to make the payment before 8 Dec 00. I was called for days once and twice and three times a day for weeks about the account. They never stop harrassing you. It got so bad we were afraid to answer the phone.

On July 31, 2000, Staci of Fort Washington, MD, wrote:
Approximately June of 1999, I had a $84.40 balance with DMB. I sent a check for that amount to pay off the account. They posted it late causing the check to bounce. I called to see if the check would be redeposited (most companies do) and they said they would. So I made sure there were sufficient funds to cover the check and honestly never followed up to see if it did go through since I was going through other issues like going back to work after having my first child, putting him in daycare, etc.

I also didn't follow up because I NEVER heard from them again. So imagine my surprise when in December I received a collection notice on behalf of DMB for $500! All of these late fees and over the limit fees kicked in, but I NEVER received any statements saying so. I argued with DMB and the first collection agency with no luck. I sent in a $50 payment and was going to send $34.40, but since the account was already charged off and I had other things to take care of at the time, I figured WHY PAY IT NOW?

Now here it is July 2000, the account was reassigned to another collection agency, I am expecting my second child. We are in the process of moving to a new home and of course I have to take care of any outstanding debts, ESPECIALLY charge offs, so I pretty much did not have a choice but to swallow my pride and pay this damn bill off! Well that's my story and my stupidity for not following up, but I see so many complaints against DMB on the Internet, that I will share my story to anyone who will listen!

On August 7, 2000, Amalia of Lubbock, TX, wrote:
I had a back injury at work in January. I have been having problems collecting workman's comp and the company I work for will not let me come back to work until after I've had surgery. I am not getting paid and I have a small child. Things are EXTREMELY hard for me right now.

I have explained this to Direct Merchants Bank on numerous occasions and they STILL call me everyday. I have told them all of this information and I have asked, "If I cut up my credit card and send it back, will you at least stop charging me 21% interest every month?" They refused. What am I supposed to do?! I have absolutely NO options here. I cannot pay them. period.

I have had to take my son out of daycare because I couldn't afford it anymore. I've had my water shut off twice. My cable has been disconnected, my long-distance service has been cut off and I am waiting for them to reposses my truck. I haven't been able to pay my mortgage and I'm tired

I have just started receiving food stamps so I can at least keep food on the table. I'm glad I finally know of all these complaints against the company. It's a wonder they're allowed to stay in business.

On August 25, 2000, Grover of Tulare, CA, wrote:
One day an offer came in for an unsecured card with a $2000 credit limit. I was about to throw it away as I had all of the previous offers. Then I got to thinking it would be a good thing to have for an emergency. I accepted the card at prevailing interest rates (at that time around 20 percent) and used it a few times on very small items and paid it off expediently every time until the "emergency" happened. I used the card to fly out to my father's deathbed and back, of course running my credit card up to a total of $1400+.

I would have paid my whole life at any interest rate they wished, I was so grateful that I had the credit card in my time of need, until I started recieving rude, untimely, ignorant phone calls about my occasionally slightly late payments. I would make double payments on my debt, sometimes a little late but never missing a payment altogether.

But the calls kept on coming, getting ruder and ruder as time went by. Finaly I had enough and told them to just stop calling me on the phone and contact me through the mail. They told me they didn't have to as they were not a third party collector. To date I estimate I have paid them around $3000 on the original $1400 debt. Needless to say I cut every card I owned & every card my family owned and closed out all accounts everywhere. I will do no more credit EVER!

On Aug. 29, 2000, Tom of Las Vegas wrote:
I fell behind on one payment. While out of town four days, they called and harrassed my wife, pregnant with twins, too many timnes to count over that period. After she told them I was out of town and would contact them when I returned, she began receiving "mysterious" calls in which the caller would not respond and then hangup over a two day period.

Direct Merchant did not place a single identified call during this time. My wife received four such calls before 9:00 AM the day I returned. She attempted to trace the calls, but was told they were scrambled. How many anonymous/prank callers have that capability? The odds of us receiving prank calls, in conjunction with Direct Merchants pestering seem preposterous to me.

On Sept. 6, 2000, Sherri of Rantoul, IL, wrote:
I am going through what other consumers are going through with them. Constant over-limit fees and late payment fees and when I was off work for 2 weeks I got no help from them on the so called insurance program I pay for on the card. Also they call me constantly at work and at home several times a day. They have even had a representative from the company get really beligerent with my 14 year old son.

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