Weighing In on the Feds’ Proposals

The Federal Government is still taking a closer look at credit card practices and, in addition, they are interested in receiving feedback from consumers regarding their feelings and concerns with the issue.

As it stands right now, there are several proposals the Fed has placed on the table. These include:

• Credit card issuers will be expected to provide cardholders with 45 days notice rather than 15 days when they plan to make a change in the terms of the credit card agreement. By providing consumers with 45 days to review the terms, they will have enough time to pay off the balance or to look for a new credit card with more desirable terms.
• Consumers would be provided with a 45 day notice, in writing, that would inform them of an increase in their interest rates resulting from default or late payment. At this time, credit card companies do not have to provide any advance notice whatsoever.
• Credit card issuers would no longer be allowed to claim that their interest rates are “fixed” in their ads unless they actually never will change. Alternatively, in the case of introductory periods, their ads could claim that the rates are fixed but must clearly state for how long.
• The table of terms created by credit card companies would have to clearly state the fees associated with going over the credit limit, taking out cash advances, making late payments, returned payments, and for balance transfers.
• Credit card issuers supplying subprime credit cards would have to make it clear to consumers that the upfront fees associated with these cards will reduce the amount of available credit they have on their accounts.
• The payment due date will have to be clearly written on the front of the monthly statement. In addition, the cutoff time needs to be placed near this date if that time is before 5:00 pm. Many consumers assume they have until the end of the day on the due date to get their payments in, but this is not always the case. As a result, they find themselves paying late fees for failing to get the payment in on time.

You still have about three more months to provide your representatives with feedback on this issue. So, if you have an opinion that you would like to express, be certain to contact your representatives right away.

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This entry was posted on Saturday, June 9th, 2007 at 8:58 pm and is filed under Credit Card News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.