Ramsey County

Making $ense of Dollars and Cents

June 1, 2009

More on Credit Card Legislation

          The recently passed “Credit Cardholders’ Bill of Rights Act” carries some sweeping changes for the credit card industry.  The legislation will hopefully make it harder for credit cardholders to fall behind on payments and easier to get out from under credit card debt.  But before you believe all is well in credit card land, you might want to look at how the legislation will affect your credit card bill.

          The Credit Cardholders Bill of Rights Act prohibits lenders form charging higher rates for purchases that push you over your credit card limit (unless you have agreed to that) but it does not limit the total number of charges for services that lenders can bill you.  Which means lenders will be looking for other new and different charges and all credit card holders may find those new charges are higher than the old ones.

          The new legislation also does not place a cap on how high interest rates can climb.  Lenders can not increase rates on your current balance unless you are very, very late with payments but interest rates for new card holders may be higher in the future.

          You may have already noticed that the number of pre-approved credit cards you receive in the mail has dropped off significantly.  Look for that trend to continue and maybe – pre-approved cards with your name already embossed on the card may disappear completely.  Receiving approval for a new credit card will probably become difficult as lenders work to avoid taking on any more clients with poor paying habits. 

          New credit cards of the near future may also have lower approved limits.  Does anyone remember when you actually had to contact your lender to ask for an increase in the limit on your card?  That may again be the standard for the credit card industry as they and we consumer learn to live with this new legislation.

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524 4th Ave NE #5, 2nd Floor Ramsey County Courthouse
Devils Lake  ND  58301
701-662-7027
email - NDSU.Ramsey.Extension@ndsu.edu