CARD act started Feb. 22 2010

Posted on February 26 2010

It’s taken some time, but the credit CARD reform act will finally be put into effect February 22nd. It’s important to find out what will be happening with your credit card accounts, so I’ve put together a quick rundown of what changes credit card companies will be forced to make.

The credit card companies will now have to notify you of any changes that may take place on your account. No longer will you be surprised to see your interest rates hiked or APR% rates increased, because with this new law the creditors have to give you 60 days notice. However, late payments will still show up as a negative mark on your credit report.

Another aspect to the new credit card law is your billing statement will now show you how long it will take to pay off your debt. This may be a huge eye-opener since most people have no idea how long it will take to eliminate their credit card debt. Paying more than the minimum amount they ask for will help you pay off your credit card debt a lot faster, and seeing how long it will take to eliminate a certain credit card can also assist with budgeting techniques.

If you are having trouble paying your credit card bills, you will also notice a toll-free number to call for help. The credit card reform law now requires this toll-free number to be displayed so consumers can call to get names of at least three different credit counseling agencies.

Your credit card due date will no longer be moved around on you. A lot of creditors use this method to get people to miss the due dates so they have an excuse to raise your interest rates or hit you with late fees. This immoral practice is over! Your due date will be the same every month unless you contact your creditor and ask for a different due date. As long as you’re current on the account, creditors are usually willing to move your due date. This can be helpful when you’re setting up a monthly spending plan.

If you wait to open up a new credit card until after February 22nd, you will be protected from interest rate hikes for the first year. This new law will make credit card companies compete for business, so waiting to open up accounts after the law is in place will benefit the consumers, as good deals and offers will undoubtedly be available, especially for those with good credit.

Young people’s access to credit will be restricted. After February 22nd, young adults (under 21) will have to get an adult, over 21 years of age, to co-sign. This can be viewed both positively and negatively. Some young adults are wise with their money and credit, but on the flip side, a lot of young adults struggle with credit cards and money. In my opinion, this will be a good thing since credit card companies have been known to target young adults.