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LaToya Irby

President Obama Signs the New Credit Rules Into Law

By May 23, 2009

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The credit card reform is now a law. Friday afternoon, May 22, 2009, President Obama signed the rules making them part of the Truth in Lending Act. The new rules go into effect on July 1, 2010. Some of the changes include:
  • No interest rate hikes on pre-existing balances unless the increase is the result of a 60-day delinquency.
  • Interest rate increases and other significant changes to your credit card agreement require a 45-day advance notice.
  • Billing statements must be sent 21 days in advance of your payment due date.
  • No over-the-limit fees unless you've requested (opted-in) to have over-the-limit charges processed.
  • No more universal default.
  • No more double billing cycle finance charges.
  • No interest rate increases in the first year of a credit card unless a promo rate expires or you've been 60 days late on your payment.
  • Payments received by 5:00 on the due date or the next business day after a holiday or weekend are considered on time.
  • Consumers under 21 cannot receive a credit card unless they've made an application and have a parent co-sign or an prove they have the means to repay the credit card balance.
These are just a few pieces of the new legislation. For complete details, read Credit Cardholders Bill of Rights.
Comments
September 9, 2009 at 7:26 am
(1) Nick says:

I really doubt this will “raise costs” of credit cards like some card givers are suggesting.

The random “we’ll apply your payment when we feel like it” policy card givers had was ridiculous. One time I paid 12 days before my due date and got a late fee of $35 and my APR went from 8.9% to 29.9%. When I called I was told “sorry sir, there is nothing we can do for you” and spent 2 weeks and nearly a dozen calls fighting it, and ended up having to fax proof my bank debited my account 12 days before it was due (I use ING thankfully, otherwise I would have had no way to prove it!)

Also, my GF has a chase card with variable interest charges, an intro 0%, 2.99%, and a regular 18%, the payments are credited to her 0% balance, while her 18% balance racks up over $200 a month in fees. Chase offers NO WAY to change this, despite it being morally wrong.

Now it will be legally wrong.

Thanks Obama!

September 10, 2009 at 1:10 pm
(2) Derek Li says:

Go Obama

October 6, 2009 at 8:30 pm
(3) Dawn Marston says:

It is about time, Credit companies have been taking advantage of consumers for too long. Even if you make good faith effort to pay your bills they seem to find a way to screw you. Thank you Mr. President.

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