New Credit Card Rules Going Into Effect On August 22, 2010
If you've ever paid a really high late-payment fee, or if you've ever felt like a sucker after reading the terms and conditions associated with a new credit card and realized you accepted an unreasonable fee schedule, then you'll like today's news. On August 22, 2010, the nation's top banking regulator -- the Federal Reserve -- is set to put into place new rules that limit certain credit card fees. For example, credit card banks will no longer be able to charge more than $25 as a late payment fee, while a penalty fee can no longer exceed $20.Here's a clip from yesterday's Federal Reserve press release:
- "... Prohibits credit card issuers from charging a penalty fee of more than $25 for paying late or otherwise violating the account's terms unless the consumer has engaged in repeated violations or the issuer can show that a higher fee represents a reasonable proportion of the costs it incurs as a result of violations.
- Prohibits credit card issuers from charging penalty fees that exceed the dollar amount associated with the consumer's violation. For example, card issuers will no longer be permitted to charge a $39 fee when a consumer is late making a $20 minimum payment. Instead, the fee cannot exceed $20.
- Bans "inactivity" fees, such as fees based on the consumer's failure to use the account to make new purchases.
- Prevents issuers from charging multiple penalty fees based on a single late payment or other violation of the account terms.
- Requires issuers that have increased rates since January 1, 2009 to evaluate whether the reasons for the increase have changed and, if appropriate, to reduce the rate.
The final rule represents the third stage of the Federal Reserve's implementation of the Credit Card Accountability Responsibility and Disclosure Act of 2009, which was enacted in May 2009. The provisions of the Act addressed in this rule will generally go into effect on August 22, 2010..."
For more, visit this Federal Reserve webpage.
Labels: credit_card_reform, credit_card_terms_and_conditions, federal_reserve
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posted by Steve Brown | 6/16/2010 02:28:00 PM
17 Comments:
What youre saying is completely true. I know that everybody must say the same thing, but I just think that you put it in a way that everyone can understand. I also love the images you put in here. They fit so well with what youre trying to say. Im sure youll reach so many people with what youve got to say.
Great! This will be really helpful for those that don't have enough money to pay their bills at the right moment. A $20 fee is more than acceptable
That's a really interesting article right there ! I like the way you point the things out. I gotta say watching the news about this after reading your article was quite boring.I'm looking forward to new articles from you.Regards , Puladeoaie
I am glad the Feds are cracking down on this. The credit card companies have been , for YEARS, fleecing us consumers with all their fine print (that admittedly NO ONE ever reads) and then charging us all these stupid and excessive fees afterward. "Oh, it's in your contract" they always say, but that doesn't help after you've already signed said contract.
The Fed needs to seriously regulate credit cards much more strenuously, and this is a good first step. let's hope they don't stop here.
this is very very useful information for credit card holders,everyone should read this and aware of fines,the images you over there are mind blowing,so keep in mind everyone should pay money at the right time.
I think whenever the rules are made, they should be made with respect of every grade of peoples, so that people are not exploited.
Charging a fixed amount 20$ for late payment is very acceptable.
Such things are really needed to get more people engaged.
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Best Regards
The rules are really good and sure this would be the best news, they used to charge so much money for credit card transactions, anyhow im waiting for the day to see the new credit card rules, i think now the credit reports (score) and points will be good for the customers.
It's about time that government actually cares about the consumers, and takes action to prove it. With these new laws, consumers are finally winning the battle against big business--that is, the credit card companies. I think that this represents a great victory for Americans.
This is a great news for people like me. It seems that the government actually cares about us. The changes are very good and eventually this is the best news for me as i have many times paid heavy charges for credit card transactions.
useful information for credit card holders,everyone should read this and aware of fines,the images you over there are mind blowing,so keep in mind everyone should pay money at the right time.
The Fed needs to seriously regulate credit cards much more strenuously, and this is a good first step.
Finally some good news for credit card holders. The new rules seems to be nice. Thanks for sharing this useful information.
what u said is truth!this will be very helpful for those that dont have enough money to pay their bills at the moment! i should say this is very useful for all credit card holders!! thankyou
this is new and great step taken by federal reserve people who are genuine and some sometimes due to some reasons not able to pay the credit payment fee on time are charged very high. this step will be new revolution in banking and credit sector of us..
Well, I guess it can save some people from paying high penalty fees. $20 is acceptable, ideed.
First of all a very informative article. Usually when people sign up for a credit card they never read the Terms and conditions, its only when they get a call or a letter from the credit card company asking for extra fees that they realize their mistake. I feel that the extra fees are a great burden on the people who are already reeling under inflation which seems to be on the rise all the time. The steps to reduce or ban fees collected is a right one and should be implemented as soon as possible.
These new rules are great, but it would be better if business credit cards were included in the new law. The Fed should institute new rules that cover business cards. They have the power to do it, and they know it should be done.
My reaction is divided. I want people to get fees shaved where unnecessary. But so many people use cards as informal checking accounts they fly from month to month without paying and still get perks and upgrades. Somebody pays for that.
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