Credit Card Act of 2009

Credit card holders, listen up: Today, 2/22/10, new federal regulations take effect, changing the relationship between you and your card issuer.

The changes are part of the Credit Card Act of 2009, signed into law last May. Congress approved the legislation to end what consumer groups have called unfair and deceptive business practices. But critics say the heavier regulations will make credit cards more costly for everyone.

Here are some of the key provisions:

  • Interest Rates: Card issuers cannot increase interest rates during the first year on new accounts. In most cases, retroactive rate increases are prohibited.
  • Payments and Billing: The issuer has to set the payment-due deadline on the same day each month.
  • Fees: Consumers cannot be charged extra fees for making payments online, by phone or by mail.
  • Disclosures: Issuers must notify card holders of significant changes to their account terms at least 45 days before the changes take effect. If the consumer objects to the changes, he or she can close the account, or “opt out.”
  • Young People: Consumers younger than 21 need an adult co-signer to open a credit card. In addition, the card issuers cannot entice students to sign up by offering free pizzas or other gifts within 1,000 feet of a college campus.

Today our credit ratings affect more than we ever dreamed they would.  Rates we pay for insurance can be lower or higher, even our prospective employers are interested in our credit ratings and scores.

The jury is still out on whether the Credit Card Act of 2009 will save us money or cost us more.


Filed under Useful and Timely Info

16 responses to “Credit Card Act of 2009

  1. fnord

    Here at our house we had to tighten things up financially before the recession reared its ugly head. We are a single income household, as many are, and that takes a little more careful consideration.

    Our world today requires a credit card for some transactions — like renting a car. Our techie daughter told us not to use our debit card for online purchases as it’s tied to our checking account and we didn’t want vulnerability there. So, we have one credit card.

    Last summer, around the time the first provisions of the Credit Card Act went into effect, we received notification that unless we opted out the rate charged would increase to prime plus 8% with a minimum of 14.99% on the expiration date listed on our card.

    As you can well imagine I opted out of that stupidity post haste!

    I began paying attention to the credit card offers that come in the mail instead of tearing them up unopened and tossing them in the ‘circular file.’ Well, guess what? Yeah, you’re all facing it too. My current rate of 5.99% which expires with my card this next September isn’t available from anyone!

    So, I don’t know exactly what we’ll do come September. Not have a credit card seems likely. Don’t know how we’ll do those things we used the card for…

  2. fnord

    Does anyone think that all these increased rates and fees the credit card companies are adding in order to make up for some of the lost revenue the regulations will bring, will eventually settle down to something that makes sense? Something that will still offer reasonable rates to those most credit worthy?

    • lilacluvr

      In a word – NO. The credit card companies know they have to raise the rates on everyone in order to get the people who are paying, and have paid, according to the contract terms.

      It’s like doctors charging exaggerated fees for their services because they know the ones with health insurance will not be paying the full amount but those without health insurance (self-paying customers) will have to pay the entire amount.

      The only trouble is with that theory is – there are very few self-paying customers anymore.

      And yet we have a Constitution that says everyone is equal? How is that equal treatment knowingly inflating your charges to counter-act the fact that health insurance companies will only pay ‘contracted’ rates which are much lower?

      I’d like to see a Tea Partier be concerned about that Constitutional problem.

  3. NightHawk

    “And yet we have a Constitution that says everyone is equal?”

    It doesn’t say that anywhere in the constitution.

    • lilacluvr

      And you might want to capitalize the word Constitution if you’re so all fired knowledgable about it.

      I think the meaning was there that I was trying to get across. If we have Tea Partiers who are so fired up to get back to the Constitution – then let’s treat everyone equally.

      Or will that cut into all the government-sponsored benefits that Tea Partiers are getting and do not want to lose?

      • lilacluvr

        I’d like to get back to the Constituion also. But that will mean no corporations will be getting all those tax cuts and subsidies from the taxpayers

        So if this is true, then why are corporations like Koch behind the curtains at these Tea Parties?

        If the mantra of the Tea Party is to throw out all incumbents – then why do so many incumbent REPUBLICAN politicians their speakers at these events?

        Are these politicians telling everyone in attendance to vote against them?

      • lilacluvr

        I should have said … Tea Partiers so fired up to get back to the Constitution and dress up like the Founding Fathers who wrote the Declaration of Independence…

        there – I covered both documents so my post won’t be nit-picked rather than the question I posed be answered.

        God forbid if a Republican ever actually answered a question.

      • NightHawk

        Sorry, I meant no offense.

    • The Constitution was based on the Principles stated in The Declaration of Independence, which restated the political philosophy of John Locke, also restated in John Adams’ Declaration of Rights of the Inhabitants of the Commonwealth of Massachusetts.

      You’re picking nits, NightHawk.

  4. fnord

    Hi NightHawk, welcome to PP&Ps.

    Point taken.

    I get the Declaration of Independence and the Constitution confused sometimes too. Both very important documents behind the basis for government of the United States of America.

    Even tho “all men” back in those times excluded even more people than they do today. Financial status seems to separate us as much today as it did back then, but we’ve made definite progress with regard to minorities and women.

    Here’s to continuing progress!

    • lilacluvr

      Like I tried to say before, I may have referenced the wrong document but the meaning was there – to anyone who cares to see it.

      But that’s the problem with this health care debate – those that have their health care taken care of by government-sponsored such as Medicare or the health insurance companies – these people don’t care about anybody else.

      These are the same people that bitch about their taxes going up but yet do not question Todd Tiarht when he tells constituents to go apply for Medicaid if they don’t have health insurance.

      Where does Tiarht and his loyal supporters think Medicaid comes from – the rainbow?

  5. fnord

    wiki (with all its limitations understood) says:

    We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

    This sentence has been called “one of the best-known sentences in the English language”[2] and “the most potent and consequential words in American history”.[3] The passage has often been used to promote the rights of marginalized groups, and came to represent for many people a moral standard for which the United States should strive. This view was greatly influenced by Abraham Lincoln, who considered the Declaration to be the foundation of his political philosophy,[4] and promoted the idea that the Declaration is a statement of principles through which the United States Constitution should be interpreted.

  6. fnord

    Hell, the SCOTUS recently gave corporations and unions extra influence as Constitutional rights! Maybe there’s hope for the rest of us… someday… Probably not, unless we have oodles and gobs of money. More each day that seems to be what it takes to enjoy all the ‘rights.’

  7. lilacluvr

    And you noticed who whooped and hollered the most didn’t you – the Republicans. That was very telling indeed.

    And then some Tea Partiers think they are standing for freedom and liberty?

    Yeah right, the freedom to kiss the boots of the master corporation.

    Corporations are nothing but the current legal form of slavery. And that is exactly why the Republicans love corporations. If you doubt that, then check the Republicans past of bringing in all those Southern Democrats when Johnson pushed through the Civil Rights Bill. All those whites fled the Democrat Party like rats from a sinking ship.

    How dare Johnson actually give everyone the same rights. Who did he think he was – a Founding Father?

    • The idea that all men are created equal was a very radical notion at one point. The US was one of the first nations to put it into the law.

      Conservatives like to wrap themselves in the flag and assert their superior patriotism–but to what “values” are they professing allegiance?

      To corporate welfare over the welfare of the individual; to police-state rights over the rights of the citizenry; to elitist power over the power of the working man.

      I don’t see where conservatives EVER supported the equality of man that Locke proposed. How the hell they can reasonably call themselves patriotic is beyond my ability to understand. Unless they are professing patriotism to the ideals of some other country than this one.

  8. fnord

    When Tim Pawlenty spoke at CPAC a few days ago he declared that America’s first “basic constitutional principle” is “God’s in charge.”

    Strange, isn’t it, that seems to be the “basic constitutional principle” of well, theocracy.

    But they’ll all say they are protecting the Constitution — even when they don’t have the slightest idea of what it says, what it stands for, or realize that it often needs to be protected from them!