Date: February 8, 2010
Save the Date: Credit Cardholder Bill of Rights Act in Full Effect
By George Thompson
Hey I’m sure most of you, if not all of you, have received changes in the mail regarding your credit cards. They have changed the terms, reduced the limits, increased the interest rates, etc. Then they say if you don’t agree with these changes the account will be closed and you can continue to pay the balance. This just doesn’t work for most of us. So this week I thought I would drop a little knowledge on what’s happening in the credit card world.
Major credit card reforms will kick in on February 22, 2010. Last May Congress voted and passed the Credit Card Bill of Right Act 2009 which was signed by President Obama. The law is designed to protect American credit card holders by strengthening consumer protection and implementing tighter guardrails to put a stop to credit card issuers “deceptive and unfair” business practices. Here’s what you need to know about the new act and how you will benefit.
Highlights of the benefits of Credit CARD Bill of Rights Act 2009:
*No increase interest rates on new credit card account for the first 12 months unless the borrower falls 60 days behind.
*No increase interest rates on existing account unless the borrower is 60 days late.
*Full and enhanced disclosures in plan language and in plan sight all terms, conditions, changes and adjustments of the credit card contact.
*Must give 45 day advance notice of increase in interest rate. In the past the credit card issuers had 15 days to notify you of these changes.
*Credit card issuers will have to include a minimum payment disclosure that explains how long it will take to pay off the existing balance and the total cost in interest fees if the cardholder paid only the minimum amount due.
*If you have shown improvement in you credit use credit card issuers can’t leave your rate at the default interest rate.
*The promotional interest rate must last for 6 months
Check back next week and I will continue with the breakdown of consumer benefits. Review your accounts and make sure the companies are getting over on you.
It is my desire that you are inspired to be good steward over these three areas of your life: Time, Talent, Treasure. Time, you must learn to manage your time; talent you have skills and gifts and lastly treasure, your finances need to managed appropriately. All of these areas work together, when they are managed properly you will be able to become A BETTER YOU!
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