Credit Card Reform

This is one of personal favorite pieces of legislation that has passed Congress in quite some time.  Finally, our lawmakers have listened and put an end to some of the predatory practices that credit card companies use against consumers. Some provions have already taken place last August.  These are the new ones. 

Interest Rates

• Starting Monday, interest rate hikes on existing balances will be prohibited unless the cardholder is more than 60 days late in making a payment.
• Additionally, credit card companies will be prohibited from raising interest rates on customers if they are late paying an unrelated bill such as a car loan or a utility bill.
• Introductory or "Teaser" rates will be required to last for at least six months, and credit card companies will be prohibited from increasing rates in the first year after a credit card account is opened.

Discosure Clarity 

• Payment dates and late payment dates will be clearly indicated on the bill.
• Agreements will be posted on the company's web site.
• Montly statements will inform customers on the length of time it will take to pay off a bill using minimum payments.
• Card holders will be notified 45 days in advance of changes to their card conditions
• Card holders will have five years to pay the card off.
• Statements will be mailed out 21 days prior to their due date.

Other Terms

• Any payments in excess of the minimum pays off the highest interest balance first.
• Card companies will be unable to charge customers for paying by phones, or the internet.
• Customers may opt in or out of over limit fees.  If they opt out, their card will reject when it is over limt.
• Customes under age 21 must obtain the signature of a parent or guardian.
• Credit card companies must not use misleading marketing presentation to minors.