New Rules for Credit Card Companies

February 16, 2010

Finances

I saw this in my Clark Howard e-magazine today, and thought it was worth repeating. I’m very glad to see the banks and credit card companies FINALLY getting some accountability (I think the banks own the United States, lock stock and barrel!!). They have been allowed to railroad Americans for too long. These changes take effect February 22, 2010.

  • Banks must give 45 days notice before raising the interest rate on future purchases.
  • Your interest rate on existing balances can’t be raised until you’re in default for 60 days.
  • Your monthly statements going forward will reflect how many years you’ll be in debt if you only make minimum payments.
  • Any annual fees must be capped at 25 percent of your card’s limit.
  • If you have multiple interest rates on your account, anything you pay over the minimum balance will be applied to the highest rate first. But beware, if you only pay the minimum, the money will still be applied to the lowest balance first.
  • Teaser rates on new cards must be honored for one year.
  • Two-cycle billing will no longer be allowed. This was a sneaky way that banks would charge massive interest if one month you paid in full and the next month you didn’t.

That last sentence was always a stickler for me– banks are SO sneaky. I now pay my bills twice a month, JUST in case. You can read more Clark Howard stuff here.

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3 Responses to “New Rules for Credit Card Companies”

  1. megscole64 Says:

    But did we really need the GOVERNMENT to force these changes? Why couldn’t people just be responsible for themselves? If their card company was screwing them over then leave. Transfer the debt to a different company. I’ve never had ANY issues with my credit card that I have through the Credit Union. I’ve even been late in paying and have had gotten no fees (and this was before all the changes). I cancel cards that are sneaky or lame. And usually a late payment charge is my own fault anyway.

    I just think less government regulation is more important than trying to micromanage a private business utilized by citizens who should either be more responsible or not use credit cards.

    Ahhh…in a perfect world. šŸ™‚

    • Rebecca Says:

      Ohhhh megscole, you sound like a “tea bagger”! Yay!! šŸ˜‰

      I am 100% for less government. But not having these regulations is not giving us less government. This is because the banking industry has a HUGE industry– the lobbying industry– on their side. Our government has been favoring banks for decades. So to slap them with some regulations isn’t making more government. Pardon my cynicism, but I think the banking industry already owns the US government. Just look at the Federal Reserve and their power over us…..

      As far as consumer choices, there are none. Not really. It’s a monopoly. Banks are inter-related now– you know, like the media: RupertMurdochClearChannelTimeWarner – TedTurnerDisneyABCFoxNewsDrudgeReportLosAngelesTimes. You can go get your news at ABC or you can go get your news at LA Times, but you’re always gonna get the same news.

      My husband and I keep getting notices that such-and-such bank has merged with such-and-such bank– and we dislike the first ban because they shiested us, but what can we do?

      Anyway… you’re right regulation never helped anybody much. But we sure don’t have free choice anymore.

  2. megscole64 Says:

    bwa ha ha ha Yes…Tea Bagger. That’s me. (Oh how I hate that term, but the MSM keep using it…so lame)

    I am not necessarily opposed to some government regulation and rules…I just think they tend to do more harm than good. Most of the time.

    Of course, being a cop’s wife there is some debate in our house over government’s role. LOL I refuse to obey some “laws” in our state and hubby threatens to write me a ticket. bwa hahahahaha

    And there is ALWAYS a choice. If I don’t want to support any of the TV stations, I just cancel all services. No one died from no TV (although I admit the thought gives me a slight panic attack…I love my TV!). Similarly, no one is FORCED to use their credit cards. I got my first one when I was 18…and yes I got into trouble with it. I had to work very hard to pay it off but I never blamed the CC company. I’m the one who overspent.

    And my Visa now is through my Credit Union. I pay it off every month and get amazing rewards. It’s convenient and easy to use but if they started making it less rewarding or more difficult to pay I would cancel it in a heart beat. No one ever died from not having a credit card. It makes life a little more difficult, but in the end a lot more simple.

    Sometimes I want to drop off the grid…can’t do that with a credit card. šŸ™‚