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Home > Credit Card Articles > Credit Card Advantage
Credit Card Users Gain a Slight Advantage
Part of sweeping credit card legislation earlier this year, the first of new rules protecting consumers went into effect last week. They offer relief from penalty fees and certain interest rate spikes.
But the bulk of the law's provisions won't take effect until February 2010, and facing toughter rules ahead, many issuers of plastic have stepped on the gas.
They are raising interest rates and fees, switching accounts from fixed to variable rates, reducing credit lines and closing accounts. The changes are a way to lock in revenue, though banks said they also
relfect the weak econonmy wich led to higher losses and funding costs.
Consumers say they're trying to get as much money from us as posslbe. At the same time, they're taking all this money from the government at zero percent interest.
Card issuers are are now required to give customers 45 days warning before raising interest rates. There's also a notice requirement for any significant change to a cards terms, which is designed
to prevent companies from suprising customers with huge alterations in rewards programs. Customers must also have the right to opt out of changes and cancel thier accounts while paying off the balances
under the old, lower interest rates.
But market watchers say card companies will still race to get ahead of the law's key provisions, which will take effect next year.\
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