Consumers have a lot more protection from rate of interest hikes, heavy late fees and other penalties in new Federal Reserve Credit Card rules approved June 22. Credit card companies have tried to stay a step ahead of the law with deceptive new fees and penalties given that the 2009 credit card law was passed. Aug. 22 is the start date of the Fed’s latest addition to credit card rules. The provisions close some loopholes and complement rules in 2009 credit card law already in effect.
Article Source: New Federal Reserve credit card rules beef up consumer protection
Credit card late fees cut
The latest additions to Federal Reserve credit card rules are the finishing touches of regulation enacted by the credit card law of 2009. A primary goal of credit card legislation was reducing penalty fees and Congress left it up to the Fed to say how. CNNMoney.com reports that consumers will most right away notice the new penalty fee limit of $ 25. There are exceptions to the rule. The credit card business can charge up to $ 35 (which they will) for more than one late payment in six months. Most credit card late fees are $ 39 until Aug. 22.
Credit card penalty fees limited
Penalty fees for exceeding credit limits are limited with the new credit card rules. Forbes reports the penalty fees cannot exceed the dollar amount of the consumer’s violation. That means a credit card business can’t charge $ 39 anymore when a customer only exceeds the credit limit by $ 20. Going forward the penalty can’t exceed $ 20. But that consumer could still face a permanent penalty hike on his rate of interest on future purchases. There will even be no a lot more inactivity fees, a penalty imposed on cardholders who aren’t using their cards.
Credit card interest rates re-evaluated
New credit card rules also demand issuers to review high credit card rate of interest hikes inflicted on consumers since Jan. 2009 within the wake of a nationwide credit crunch. The New York Times reports that if your credit card company raised your interest rate after Jan. 1, 2009, it could have to re-evaluate its reasons for doing so and potentially lower the interest rate if it finds that those reasons no longer apply.
Need to know – new credit card rules
The Fed is offering consumers more details online about how the new credit card rules affect them with “What You Have to Know: New Credit Card Rules Effective Aug. 22.
Additional info at these websites
money.cnn.com
forbes.com
bucks.blogs.nytimes.com
www.federalreserve.gov
