Credit Card Rights And Credit Card Rules – Policy Changes On The Way

Credit Card Companies and Banks will have to play by different rules starting in 2010 as the Federal Reserve Board is putting an end to their controversial and unfair credit card practices and policies.
For years, credit card companies have raised interest rates without notice, charged late payment interest, late payment fees, and other types of credit card fees for the slightest hiccup in a consumer’s credit payment history. Below is a summary of the new credit card policy rules passed by the Federal Reserve Board to protect your Credit Card Rights and your pocketbook.

Ban Short Late Payment Interest Rate Changes
In the past credit card companies have been able to raise your credit card interest rate for the slightest late payment – sometimes as short as 3 days past due. With the new credit card rules, credit card companies will not be raising your credit card interest rates until you are more than 30 days past due on your payment due date. Additionally, credit card companies will not be able to report your credit report with a late payment unless you are actually more than 30 days past due.

Universal Default Policy or Clause
If you take a close look at your credit card agreement you will most likely find a section called the Universal Default Clause or Policy which essentially gives your credit card company free reign to increase your credit card interest rate if they find out that you have been late on any of your credit accounts, not just their credit card account. When the new credit card rules take effect in 2010, credit card companies will not be able to raise your interest rates on your account unless you are late with your payment to that particular credit card.

Double Cycle Billing – Retroactive Interest
Double cycle billing is used by some credit card companies to calculate the finance charges due on your credit card debt. In some cases, credit card companies will look at your average daily balance over a 60 day period versus just 30 days per billing cycle. With this expanded period of time, you could still be billed on a previous balance even though you paid the balance off or down. The Fed changes to credit card policies will eliminate a finance charge calculation based on the longer billing cycle.

Credit Card Statements More Readable
Current credit card statements for many companies are filled with credit card policy and legalese which are all written in very small print making the credit card statement hard to read and understand. The credit card policy changes on the way will require banks and credit card companies to make statements more readable and understandable.
Stay tuned for the important changes coming in 2010 designed to improve credit card practices and protect your credit card rights.