I've spent some time researching the issue and here's what I found out:
1. The issue is happening with new accounts, existing accounts with debit cards, gift cards and paypal but does not appear to be happening with major credit cards that are not connected to a checking account.
2. Is only happening with major banking institutions BofA, Chase, Wells Fargo and Citi.
3. Calling Apple does not help.
4. Things that have solved the issue for some people include:
-updating your address so it matches the address you have on file with the bank.
-calling the bank to make sure your debit card is crv enabled. Even if it was before, having them check can fix the problem.
-using a card that is not connected to a checking account.
-entering the last 4 digits of the card number for a visa as the security code.
5. Things that make the problem worse or unfixable include
-entering your security code over and over, this will lock your account.
-loging in from different devices.
-changing the billing info more then 3 times.
Hope your happy apping soon! Apple is not addressing the issue. There is no quick fix. Some of these things work for some and not for others. Good luck!