5 Big Changes To Credit Card Law
On February 22, 2010, our federal government enacted some of the biggest changes to credit card regulation that our country has ever seen. With the passing of the Credit Card Accountability Responsibility and Disclosure Act of 2009, or CARD Act, several changes have been made to protect you and the hundreds of thousands of other credit card holders in the United States.
Rate Increases
Beginning on August 20, 2009, credit card companies will only be able to increase the rates on existing balances under limited conditions. Now, changes can only be made when a promotional rate ends or after a customer misses a payment by 60 days or more. Additionally, if rates are increased do to a missed payment, the original rates must be restored if the cardholder makes payments on time for six consecutive months.
Advance Notice of Rate Changes
Also beginning August 2009, credit card companies must give cardholders 45 days notice before contract changes take effect. Prior to changes, only 15 days notice was required.
Payment Time
The third provision beginning August 2009 is that Card companies must send statements at least 21 days before a payment is due.
Fee Restrictions
The new law requires that payments received on the dude date or on the next business day not be allowed to incur a late fee. If cardholders choose to pay fees at a local branch, they must be credited the same day.
Billing Cycles
The credit CARD ACT bans the practice of basing finance charges on the current and previous balance, known as double-cycle billing. This way credit card companies will no longer be allowed to charge interest on debt already paid the previous month.
