Credit Card Quick

Your Rights under the new Credit Card Legislation

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You may be quite confused with the new CARD act. However, there are a number of benefits to this new credit card legislation that you should know about. Don’t let all of the language and confusing terms overwhelm you; just pay close attention to your credit card statement and educate yourself on all of the changes that are taking place, courtesy of the new credit card legislation.

• Your creditor can not raise the interest rate on your card unless you are more than 60 days past due. Even then, they must give you 45 days notice before they can raise your rate.
• Your creditor can no longer raise your interest rate because you were late on another bill. Before the credit card legislation went into effect, credit card companies could actually raise your interest rate if you were late on another payment, as they felt as if you were a greater credit risk.
• Your minimum monthly payment can change at the discretion of your creditor, so pay close attention to any changes regarding your credit card’s minimum payment.
• You must give your creditor permission to allow you to exceed your credit limit; otherwise, your credit card company cannot charge you an over-the-limit fee.
• Don’t expect to secure a credit card easily if you are under 21 years of age. Unless you can prove a steady income, expect to need a co-signer for your credit card if you are under 21.
• Your creditor must clearly outline how long it will take to pay off your credit card if you only continue to make the minimum payment. Many times, this type of disclosure can provide consumers with the knowledge to pay off their cards sooner than later.
• Your creditor must give you 45 days notice before they raise your interest rate. However, even with an increase in your interest rate, your creditor can only charge you the higher rate on future purchases, not on purchases made under your old interest rate.
• You still need to keep a close eye on your card’s fees and charges, as the new credit card legislation does not restrict how much creditors can charge for these fees.