Wednesday, November 11, 2009

Credit Card Act 2009

With the Credit Card Act 2009 going into effect within just a few short months, many consumer are wondering just what will change. In reality, probably not much. Most of the changes have more than likely already occurred. Have your rates gone up and credit limits gone down? Well, there you go. There’s the Credit Card Act 2009 changes. But wait, there’s more.

The most effective portion of the Credit Card Act 2009 limits the ways in which credit card companies can raise your rates, which is why they are all doing it now before the Act goes into effect. Your credit card company must give you an entire 45 days notice before making any changes to your credit card account, including rate hikes. This notice is supposed to allow consumers time to either pay-off their balance, choose to close their account or transfer the balance to another credit card.

The other day I received a letter in the mail informing me that my credit limit had been increased, but so had my interest rate. There was no warning, and there was absolutely nothing that I could do about it. The interest rate was a direct result of the impending Credit Card Act 2009, and every single card holder of this bank had received the exact same rate hike.

Another new initiative included in the Credit Card Act 2009 deals with over-the-limit charges. Consumers are now guaranteed to have a choice of whether to opt in or out of over-limit charges. If you opt out, which ever consumer should do, then you will not be allowed to purchase anything over your credit limit.

One of the greatest initiatives of the Credit Card Act 2009 is its affect on students. No longer will you see credit card companies on college campuses handing out t-shirts and hats. Free gifts as incentives are strictly prohibited in the new Act, as well as even appearing for marketing purposes on a college campus.

Any person under the age of 21 who wishes to get a credit card must either have a parent’s approval and signature, or can show proof of income to repay any loan or debt. This differs greatly from the times when anyone, any age it seemed, could get a credit card.

All of the new credit card legislation is intended to keep people from falling into credit card debt, and to keep the credit card companies honest.

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