The
CARD act
The Credit
Card Accountability, Responsibility and Disclosure Act,signed
into law on May 22, 2009, supposedly will provide
increased consumers protection.
Most of the
changes
go into effect after February 22, 2010. Already, many credit card
issuers have increased rates, fees
and have taken an immediate defensive posture. Probably, when CARD
takes effect, the Banks will have worked around the so-called
protections. Hopefully,
not too many people will be shut out of credit cards.
The CARD Act
provides:
1. Notice of Rate
Increases. Starting August
20, 2009, credit card companies must provide 45 days written
notice of an
increase in the interest rate. The Act prohibits interest rate
increases on existing
balances.
2. Promotional
Rates Must
Last 6 Months. The CARD
requires any promotional interest rates to be effective for at least 6
months.
3. 21 Day Payment
Period. Credit
card companies must allow cardholders 21 days from the mailing
date to pay off the balance without interest.
4. Over-Limit Fees.
Cardholders must give permission to pay transactions exceeding
the credit limit. This will reduce expensive over-limit fees but
increase "declines."
5. Useless
Notices.
Credit card companies will be forced to provide useless notices about
credit, credit scores, etc.
6. Gift Card and
Certificates must have
charges and limitations clearly listed.
7. Business
Credit Cards.
The CARD Act does not apply
to corporate and business cards.
If you
need help
with credit information and help call Ronald J. Cappuccio, J.D.,
LL.M.(Tax) at (856) 665-2121.
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