Credit Card Act
New Administration, hopefully will bring positive changes for consumers.
The Credit Card Act is a good place to start.
Deregulation allowed credit card issuers to just run amok and charge credit card holders for just about anything and everything under the sun.
This Bll thankfully goes into effect in February 2010.
It results in making illegal several horrible practices that credit card companies implemented to charge higher fees and more penalties.
More revenue for them...
Under deregulation, a credit card holder paying their bill on time as agreed could be hit with a rate increase if lets say they paid any other bill late in error.
This was called Universal default. I call it a Unviversal Rip Off.
It looks as though some of the industry response has been to increase whatever interest rates they could before the act actually takes effect.
Here are the main changes.
- Card holders must be notified 45 days prior to significant changes in the card agreement
- Bills must be sent out at least 21 days before the due
date
- Payment amounts above the minimum payment are supposed to be applied to the balance with the highest interest rate
- Retro active interest rate increases are banned unless your payment is more than 60 days late
- The practice of raising your rate if you are late paying different creditor is no longer allowed
- If the rate is increased for being late, it must be returned to the previous level if you are on time with payments for 6 months
- Rates cannot be increased in the first 12 months the account is open, except in certain circumstances, and promotional rates must be good for at least 6 months
- Payments must be credited as on time if received by 5pm on the due date
- People under 21 will need a co-signer unless they have proof of ability to repay the debt
- People under 21 cannot receive pre-screeened credit card offers unless they opt in
Credit Card Act
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