New 2010 Credit Card Laws - What it Means For You.
On May, 22, 2009, President Barack Obama signed the new credit card act of 2009. The first batch of rules was voted in on August, 20, 2009 with the majority of provisions starting on February, 22, 2010. Now that the new credit card laws of 2010 [http://www.newcreditcardlaws2010.com] are here, you are all asking, what does this mean for you? Will there be more benefits than downfalls with the new laws? I am pleased to say that while nothing can be made perfect, the new laws will bring cardholders a little more relaxation than the credit card laws of the past. One of the biggest changes for you is the avoidance of interest rate increases, and the biggest change for issuers is the overall advertisement on credit cards. They will be limited in the amount of freedom given to them and in the end, save you money and time.
Universal Default
No longer will issuers be able to raise the interest rate on cardholders based on their past payment records with unrelated issuers, such as utility payment companies. This would end for already existing credit card balances. Universal Default means that credit issuers can go into your account, look at one little negative piece of information and automatically increase your interest rate. If you go into foreclosure on your mortgage, no longer can Universal Default take effect. After foreclosure take the time to raise your credit and pay off the debt, instead of having to worry about a negative piece of information rake your wallet.
Opting Out
You now have the right to opt out of new changes on your account or in other words reject them. This means that you are agreeing to pay off the balance with the old laws if you close your account and ignore the new laws. When you do finally decide to put this agreement into action, you have five years to pay off the balance.
What the new card laws mean for young adults
Young adults are constantly being tempted into applying for a credit card whether it be for free food or other gifts. As of now, Credit Card issuers are not allowed to come within 1000 feet from a college campus, whereas before they were allowed anywhere towards young adults unaware of the consequences. Issuers can not apply anyone under 21 for a credit card unless they have a adult cosigners on the account, or can prove they have enough income to pay the card debt.
More Time
The new credit card laws of 2010 [http://www.newcreditcardlaws2010.com] give all cardholders more time to pay monthly bills. In the past, you were notified 14 days in advance to pay your monthly bills. Many complained that this was not enough time and resulted in late payments. With the new laws issuers are required to let you know 20 days in advance, giving almost one more week to pay the balance.
Interest rate increase notification
Issuers must notify you 45 days in advance if there will an interest rate increase. There can also not be any interest rate increase for the first year of a newly opened account. In the past, cardholders were sometimes never notified of an increase, but were expected to pay off the balance.
These are just a few benefits to the new credit card laws of 2010 [http://www.newcreditcardlaws2010.com], safety for young adults against issuers, more time to collect the money, sooner notifications, the option to opt-out or reject overdrafts, and laws against Universal Default. Although not all of the problems have vanished from the issuer-cardholder relationship, the new laws of 2010 certainly will make it a little bit easier on the wallets of customers, and less fun for the credit card issuers.
Universal Default
No longer will issuers be able to raise the interest rate on cardholders based on their past payment records with unrelated issuers, such as utility payment companies. This would end for already existing credit card balances. Universal Default means that credit issuers can go into your account, look at one little negative piece of information and automatically increase your interest rate. If you go into foreclosure on your mortgage, no longer can Universal Default take effect. After foreclosure take the time to raise your credit and pay off the debt, instead of having to worry about a negative piece of information rake your wallet.
Opting Out
You now have the right to opt out of new changes on your account or in other words reject them. This means that you are agreeing to pay off the balance with the old laws if you close your account and ignore the new laws. When you do finally decide to put this agreement into action, you have five years to pay off the balance.
What the new card laws mean for young adults
Young adults are constantly being tempted into applying for a credit card whether it be for free food or other gifts. As of now, Credit Card issuers are not allowed to come within 1000 feet from a college campus, whereas before they were allowed anywhere towards young adults unaware of the consequences. Issuers can not apply anyone under 21 for a credit card unless they have a adult cosigners on the account, or can prove they have enough income to pay the card debt.
More Time
The new credit card laws of 2010 [http://www.newcreditcardlaws2010.com] give all cardholders more time to pay monthly bills. In the past, you were notified 14 days in advance to pay your monthly bills. Many complained that this was not enough time and resulted in late payments. With the new laws issuers are required to let you know 20 days in advance, giving almost one more week to pay the balance.
Interest rate increase notification
Issuers must notify you 45 days in advance if there will an interest rate increase. There can also not be any interest rate increase for the first year of a newly opened account. In the past, cardholders were sometimes never notified of an increase, but were expected to pay off the balance.
These are just a few benefits to the new credit card laws of 2010 [http://www.newcreditcardlaws2010.com], safety for young adults against issuers, more time to collect the money, sooner notifications, the option to opt-out or reject overdrafts, and laws against Universal Default. Although not all of the problems have vanished from the issuer-cardholder relationship, the new laws of 2010 certainly will make it a little bit easier on the wallets of customers, and less fun for the credit card issuers.
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