Limited interest rates hikes. 45 day advanced notification for many fee changes. No interest rate increases for that first 12 months of holding a merchant account. These are just a few from the new changes to the card business. In short, The Credit Card Responsibility, Responsibility and Disclosure Act of '09 (the CARD Act), which went in to effect in February, is aimed at preventing banks from sneakily raising rates of interest and changing terms on an accounts, which ultimately lead consumers deeper in to debt. Some of the key options that come with the CARD Act include: Limited rate of interest hikes: increases in interest rates on existing balances is going to be limited to specific conditions, including the finish of a promotional rate period, variable rate changes or when the cardholder misses a payment
Minimum 6 month promotional rate of interest period
45-day advance notice required for many fee changes, including pending rate or even fee increases
Issuers must notify card holders from the right to cancel a card ("opt out") when the holder doesn't agree to changes within the terms of the accountYoung Adults: Young adults under 21 years of age have to have an adult co-signer to open a brand new account, or show proof of earnings. Poor Credit History: Looking to obtain a card, but have poor credit background? Beware. While the regulations stipulate that in advance account-opening fees cannot exceed 25% from the initial credit limit, some issuers are looking at absurdly high interest rates on these types of accounts, with one card company quoting the 59. 9% APRCorporate Credit Cards: It's vital that you note that the new laws just affect consumer cards, not corporate credit cards. If you have a business greeting card, be sure to stay on top of changes in the conditions and terms of your card. Once the brand new regulations are fully phased in through December 2010, the credit card sectors marketing, billing and advertising
will end up being fundamentally changed. This also means the issuers will have to reign in their rewards programs as well as potentially increase annual fees.
Stephanie Neruda Leader, NerdWallet LLC http: //www. nerdwallet. comNerd Wallet is credit cards search and comparison site, and seeks being the best source for unbiased charge card information. The company was founded with a financial industry veteran in the wake from the financial crisis in August 2009, as well as officially launched in March 2010. NerdWallet is actually privately held, and is based in Ny, NY.
View this post on my blog: http://creditcard.valuegov.com/the-credit-card-act-what-do-new-regulations-mean-for-you/
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