Interested in what the new credit card laws mean for you? Here’s a quick rundown of some of the changes we’ve seen in the recent credit card legislation changes and how it can benefit you:
- Banks can’t raise interest rates on existing credit card balances unless a promotional rate ends, you’ve been late with a payment, or the card has a variable rate.
- Interest on new balances can only be increased after 12 months if the promotional rate ends or payments are 60 days late.
- You must have the right to “opt out” of major changes to your credit card terms. Opting out closes the account but you have five years to repay your debt at the current interest rate and terms.
- Banks can only sign up people under 21 for credit cards if they have an adult co-signer or can prove they have enough income to pay bills.
- You must receive your statement at least 21 days before payment is due.
- Credit card statements must clearly show the date and time your payment is due. The time must be no earlier than 5 p.m. on the due date.
- Statements must explain how long it would take to pay off your balance by making only the minimum payments.
Pay close attention to the fine print in credit card offers to become familiar with the terms and conditions. Also read your statements on existing accounts carefully to understand any changes; think twice before signing up for credit card offers, such as cash advances, related to existing accounts.
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