Outrageous credit card fees, interest rate hikes and credit for teenagers. All those things will soon be a thing of the past. News 4 WOAI Trouble Shooter Jaie Avila goes straight to the experts to explain the new credit card regulations set to kick in next Monday.
The Credit CARD Act of 2009 was signed into law last year and takes effect next Monday. One of the biggest changes will credit card companies to you 45-days notice before making any changes to your account.
"If you have a card and you're paying 12% interest and all of a sudden they go up to 15%, you need to know they can't do that," says Denise Surratt with Consumer Credit Counseling Services of San Antonio.
Also starting Monday, your payment due date will be the same every month. If it lands on a weekend, you'll have until the next business day to pay.
Creditors won't be allowed to charge you an 'over-the-limit' fee unless you want the ability to go over your limit. Otherwise, any transactions that would put you over the limit will be denied.
Also, credit will no longer be given to anyone under 21 years of age unless an adult co-signs. "In my work, I'm glad that that came about cause I've seen too many young people who've gotten into too much credit card debt before they even get out of college," adds Surratt.
You can expect your credit card statements to look different, too.
Those statements will now include just how long it will take you to pay off a balance if you only make the minimum payment. And your statement will include contact information for licensed credit counselors if you find yourself in credit trouble.
"They'll be within your zip code area," says Surratt. "And you can call one of those numbers if you need help as far as paying down your credit card or if you need some counseling."
For consumers, there is a downside to the new credit regulations. It will be harder to get credit. That is because credit card companies will have to verify your income before extending you credit.
The new law also says if you don't like any changes your credit card company makes to your account, you can reject those changes, close your account and you then have five years to pay off your balance.
For complete information on the Credit CARD Act of 2009, click here.
For more information: Consumer Credit Counseling Services of SA
