3 Things Your Credit Card Company Isn’t Telling You
With the passing of the Credit CARD Reform Act, there are several changes being made to how the credit card industry is being regulated. These changes are intended to protect you, the consumer, but may actually create ways for credit card companies to take advantage of you against your will.
The following are ways that your credit card company could be taking money from you without telling you.
Advance Notice Limits Your Options
According to the new CARD Act, your credit card companies are required to give you 45 days’ advance notice before they make any significant changes to your account. What the law doesn’t say is that credit card companies have to let you keep your current rates. So your credit card companies could potentially raise your rates to extremely high amounts, giving you ample notice ahead of time.
If you don’t choose to accept those new rates, your credit card company can either allow you to continue using your existing rates until your card expires or just close the account entirely. And either way, you are still required to pay the entire balance in full.
Students Can Still be Targeted
Another part of the CARD Act that credit card companies have found a way to dance around are the limits to getting younger adults to sign up for cards. The CARD Act states that credit card companies can no longer open credit cards to college students without the written consent of a guardian.
In order to step around that blockage, many credit card companies are mailing credit card offers for college students to parents of college-aged children. Because if they’re offering the deals to parents instead of students they’re not breaking any rules, right?
Double-cycle Billing isn’t Completely Gone
A huge change brought by the CARD Act is the ending of double-cycle billing. Double cycle billing is when your credit card company calculates your interest based on the previous two billing cycles instead of just your current balance.
But unfortunately, while that practice is over and done with, you could still be receiving additional charges if you don’t have a grace period. A grace period is the time period when your credit card company allows you to avoid interest charges if you pay off your entire balance.
But if you don’t have a grace period, none of the new double-cycle billing rules apply, meaning nothing changes.
