Posted on Saturday, February 20th, 2010.
New Credit Card Legislation… And It's Loopholes?
The second phase of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009 will take effect Monday February 22nd, 2010. The critical parts of the new legislation include caps on interest rates, approval of over the limit fees by the consumer, annual fee limit caps and so on. While all this is good news for the consumer, a column piece by Michelle Singletary posted in The Washington Post delivers some of the loopholes. Once again, it’s about reading the fine print. Here’s an excerpt:
“…Issuers cannot raise interest rates on existing balances. If you have a balance, your old interest rate will apply to that balance.
The loophole: Your credit card company can still raise the rate for new charges under certain conditions, such as if the card carries a variable indexed interest rate or an introductory rate promotion ends. For many of you, kiss those low fixed rates goodbye. Surveys conducted in the months before the law’s enactment found that many issuers boosted interest rates on purchases and cash advances. Even customers with excellent payment histories have seen their rates jump.”
Read the full column on loopholes of The Credit CARD Act of 2009.
