BBC hax written an article stating: "President Barack Obama has signed into law extensive new restrictions
on the ability of US credit card companies to charge fees or raise
interest rates."
"The bill is designed to protect credit card users from unexpected fees or increases to their interest rates." To view the whole article, click here
"Big changes
The new law, described as a credit card holder "Bill of Rights", is the first of a series of law changes designed to help stave off further financial crises.
Among the main provisions of the new law are ones that:
• stop arbitrary interest rate increases and "universal default" on existing balances. In universal default, a lender can change a cardholder's account to costly "default" terms from normal terms when the lender learns the cardholder missed a payment on an account with another lender, even if the cardholder has not defaulted with the first lender
• stop card issuers from raising rates for a cardholder in the first year after an account is opened, and require that promotional rates must last at least six months
• stop issuers from charging fees for spending beyond their limits, unless the cardholder chooses to allow the issuer to process the excess spending, and restrict any "over-limit" fees
• require penalty fees to be reasonable and proportional to the cardholder's omission or violation
• require that cardholders be told how long it would take, and the interest cost involved, in paying off a card balance if they make only the minimum monthly payments
• require that cardholders must get 45 days' notice of interest rate, fee and finance charge increases
"The bill is designed to protect credit card users from unexpected fees or increases to their interest rates." To view the whole article, click here
"Big changes
The new law, described as a credit card holder "Bill of Rights", is the first of a series of law changes designed to help stave off further financial crises.
Among the main provisions of the new law are ones that:
• stop arbitrary interest rate increases and "universal default" on existing balances. In universal default, a lender can change a cardholder's account to costly "default" terms from normal terms when the lender learns the cardholder missed a payment on an account with another lender, even if the cardholder has not defaulted with the first lender
• stop card issuers from raising rates for a cardholder in the first year after an account is opened, and require that promotional rates must last at least six months
• stop issuers from charging fees for spending beyond their limits, unless the cardholder chooses to allow the issuer to process the excess spending, and restrict any "over-limit" fees
• require penalty fees to be reasonable and proportional to the cardholder's omission or violation
• require that cardholders be told how long it would take, and the interest cost involved, in paying off a card balance if they make only the minimum monthly payments
• require that cardholders must get 45 days' notice of interest rate, fee and finance charge increases
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