Posted on June 8th, 09 by dailysavingsfromallyou
Learn the new credit card rules
You probably saw in the news that President Obama signed a credit card reform bill last month. How does it affect you? Here’s a cheat sheet.
Interest rate changes: Card companies used to be able to change your interest rate for any reason at any time. Now you must get at least 45 days’ notice.
Due dates: Previously, some card issuers gave you only 14 days to pay, hoping you’d send your money late so they could slap on a big fee. Now, they must allow a minimum of 21 days after sending your statement.
“Double billing”: Say you had a $1,000 balance and paid $300 of it. You’d think your interest for the next month would be based on your $700 balance, right? Wrong, at least in the past. Companies used to be able to calculate interest using the average balance for the previous two months. But this bill outlaws that.
Over-limit fees: Previously, credit card companies would let you charge over your limit but then sock you with a fee. As of March 2010, the card company must get your permission for a charge over your limit. That means you’ll be notified and can cancel the purchase if you want to.
Keep in mind that the last two changes don’t take effect until February 22, 2010. For now, stay vigilant. Watch your statement for interest rate changes, pay on time, and work on paying off your balances.
Posted by Betsy Wiesendanger, Contributing Editor
