Are you paying new, higher charges on your credit cards?
OnlineGuideTo.com — When the Credit Card consumers’ Bill of Rights goes into effect next month (Feb. 22, 2010), banks will be prohibited from using some of the worst unfair practices they have been subjecting their customers to.
Parts of the consumer protection law went into effect almost nine months ago.
But when Congress passed the law it gave bankers some time to prepare for the radical provisions of the Credit Card Accountability Responsibility and Disclosure Act (CARD).
At the time politicians, pundits, and financial experts warned that the banks would use this time to — in non-bankers’ terms — really stick it to their customers.
During the debate over CARD the American Bankers Association also assured Congress there would be negative consequences if certain banking practices were to be banned.
They were right. Over the past nine months credit card issuers have closed many accounts, lowered credit lines, added new fees and raised their interest rates.
And they won’t stop there.
During the rest of this year you will see your banks roll out a plethora of new fees and products in an effort to replace more than $50 billion in revenue wiped out by new rules.
If you are still using credit cards and — like many — haven’t paid much attention to your bank’s mailings and billing enclosures, you should take some time to check and see what has changed.
Note that some of the new fees apply only to new accounts. If you are shopping around because you are not pleased with your current credit provider, keep in mind that other banks may soon introduce new rates as well.
Some things to look for:
- Higher penalty fees, such as for late payments
- An annual fee for use of the credit card
- Fees for inactive accounts
- Cards switched from fixed interest rates to variable rate
- ‘Processing fees’ for your printed statement
- Dropped or reduced reward programs
Some of these fees also affect checking accounts.
In fact, free checking may well be a thing of past. Many banks qualify their ‘free checking’ ad slogans by adding conditions and stipulations. For instance, your account may be free only if you maintain a certain minimum balance.
