Barack Obama should be signing the new credit card bill that was passed by the Senate earlier this week.  The new credit card laws should be coming into effect within the next nine months.  This assuming that the bill actually gets signed.  It appears that it will.    The new credit card rules will be easier for people to understand.  Credit analysts believe that the new laws will make credit cards and consumer credit more difficult to get and more expensive for consumers.  We may see yearly fees come back on all credit cards.  Low income households may have a tough time obtaining new credit cards from credit card companies.  Card holders will have more time to pay the monthly bill, more notice of rate changes including late fees and interest payments.

What are The New Rules For Credit Cards for Consumers?

• Consumers will have more time to pay the bill.  Bills would be due 21 days after they are mailed.  Creditors would no longer be able to make early morning or other arbitrary due dates for paymenhts.  Due Dates that fall on weekends or when the credit card company is closed would not be subject to late fees.
• Over the limit fees would be a choice.  You would have to choose an option that would allow you to go over your spending limit rather than just being able to.  Many consumers get in trouble with over the limit fees because they don’t even know that they have gone over the limit.
• The consequence of making minimum payments must be spelled out clearly to the credit customer.
• Changes in interest rates could only occur after a 45 day notice.
• The practice of Double Cycling would be eliminated

Hopefully these changes will give all consumers a better chance to pay off their debt for good.  Maybe consumers will think twice about getting into debt in the first place and in the long run be more responsible.

Your credit card company may have lowered your available credit, but why?  If you have been watching the news lately, most of the major headlines revolve around the credit crunch and foreclosures.  Banks and lenders do not want to leave themselves exposed to unecessary losses.  A few months ago Washingotn Mutual lowered my home equity line over 75%.  I had never even used the thing.  The banks are worried that when times get tough, people are going to tap into their equity lines and then default.  The bank just wants to hedge their bet and cover their losses by removing excess credit from people.  This is done in the form of closing credit cards, cancelling home equity lines and lower available credit for credit cards. Continue Reading »