Tomorrow is a big day for credit card holders….new credit card regulations are set to kick in. The Better Business Bureau says the new regulations should be good news for some card holders… if you pay attention to you credit card statement and read the fine print in your credit agreement.
Under the Credit CARD Act of 2009 card issuers must give card holders 45- days advance notice before changing the interest rate. Promotional rates must apply for at least six months and unless disclosed up front, the interest rate cannot be increased during the first year you hold the card. And if there are changes made in the terms of the account, card holders can choose to reject those changes, close their credit line and have five years to pay off the balance under the original terms they agreed to.
Another new regulation means that card issuers can no longer give a credit card to anyone under 21, unless they can prove they have the means to repay the debt or if an adult over 21 co-signs on the account. Credit card companies also face new restrictions on how they can promote credit cards to college students.
Card issuers must now tell you how long it will take to pay off your bill if you make only the minimum payment and how much you would need to pay every month in order to pay off the balance in 36 months.
You may also notice that your bill due date will be about 21 days after the bill was mailed to you. There will no longer be charges to card holders who pay online, over the phone or by mail. The no fee phone rule does not apply to phone payments made the day of the due date, the day before the due date or anytime after the regular due date.
The new consumer protections may not be good news for card holders who pay their bills on time and in full each month. Those card holders could see a reduction in benefits, new annual fees and credit lines cut. Business and corporate credit cards are not included in the new consumer protections from the Credit Card Accountability Responsibility and Disclosure Act of 2009.
The BBB says all credit card holders should read the fine print in their credit agreements and be aware of any fees and penalties included in them.
For a break down of the new regulations, click here or for the Better Business Bureau click here
