On Tuesday the Senate voted to approve a bill that will make it tougher for credit card issueers to raise fees and interest rates starting early next year.  This action comes after years of abuse by credit card companies of their customers.  Chris Dodd said “To have the industry reaching and be as abusive to consumers, it needed to stop and it needed to change”.  The bill would make it more difficult for people under the age of 21 to get credit card.  It would also eliminate interest rate hikes unless a customer is more than 60 days late on their credit card bill.

No More Late Fees On Late Credit Card Payments

The new bill would prevent interest rate hikes on consumers who are late on their monthly credit card bills.  The new rules for consumer credit would allow a rate hike only after 30 days late.  As it is now, if you miss you payment by one minute, some credit card companies have the right to raise your interest rates to as much as 30%.  No wonder consumers are mad.  With the current economic crisis, many consumers are just throwing up their hands and walking away from their debt.  Hopefully this new law would have people be more willing to pay off their debt.  When asked about a debt bubble Timothy Geitner did not seem to be concerned about it.

Is a credit card company allowed to lower your credit limit?  A credit card company is allowed to lower your credit limit without warning if they see fit.  The credit crisis has many credit card companies in a real bind.  Many credit card companies just can’t pay their credit card bills and are defaulting on their credit cards.  The credit card companies want to beat you to the punch and don’t want to extend themselves any further than is necessary.

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