New credit card rules aid consumers

President Obama signed the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 on Friday, May 21,, marking a turning point for American consumers and ending the days of unfair rate hikes and hidden fees. In the Senate and throughout the campaign, President Obama called for measures to strengthen consumer protection in the credit card market.
This legislation was made possible by the leadership of Chairman Frank and Representatives Maloney and Gutierrez in the House, and Chairman Dodd, Ranking Member Shelby and Senator Levin in the Senate.  It builds on the strong first step taken by the Federal Reserve toward improving disclosures and ending unfair practices.




Principles for Long-term Credit Card Reform

  • First, there have to be strong and reliable protections for consumers.


  • Second, all the forms and statements that credit card companies send out have to have plain language that is in plain sight.


  • Third, we have to make sure that people can shop for a credit card that
    meets their needs without fear of being taken advantage of.

  • Finally, we need more accountability in the system, so that we can hold
    those responsible who do engage in deceptive practices that hurt
    families and consumers.

Key Elements of the Credit  Caaed Act of 2009:
Unfair Rate Increases and Retroactive Rate Increases; First Year
Protection, Contract terms must be clearly spelled out and stable for
the entirety of the first year; ends Late Fee Traps; Enforces Fair
Interest Calculation; Requires Opt-In to Over-Limit Fees; Restrains
Unfair Sub-Prime Fees; Limits Fees on Gift and Stored Value Cards
Sight /Plain Language Disclosures; Plain Language in Plain Sight; Real
Information about the Financial Consequences of Decisions.
will need to display on periodic statements how long it would take to
pay off the existing balance and the total interest cost if the
consumer paid only the minimum due. Issuers will also have to display
the payment amount and totalnterest cost to pay off the existing
balance in 36 months.
Accountability: The act will help
ensure accountability from both credit card issuers and regulators who
are responsible for preventing unfair practices and enforcing
Cleans Up Credit Card Practices For Young
People at Universities.  The act contains new protections for college
students and young adults, including a requirement that card issuers
and universities disclose agreements with respect to the marketing or
distribution of credit cards to students.

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