As of February 22 2010, new rules governing credit cards will take effect. These rules can be a helpful tool in the average American consumer’s journey to get out of credit card debt. Below are some key changes designed to help credit card users.
Your credit card company must provide 45 days notice when they plan to:
- Change your interest rate with the exception of variable interest rates tied to an index such as prime interest rate, the expiration of an introductory interest rate, in the event that you have failed to make a payment under a settlement agreement.
- Change certain fees including annual fees, cash advance fees, and late fees
- Make any other significant changes to the terms of your card.
When your credit card company is planning to implement changes to the terms of your credit card you will be given the option to accept the terms or cancel the credit card before the date that the new terms go into effect. Taking that action will result in your account being closed and can result in your monthly payment being increased to an amount that will pay off the card in a set amount of time.
Your credit card company must tell you how long it will take to pay off your balance. This will be shown on your monthly billing statement and will show a projected payoff date if you pay only the minimum payment. The statement will also reveal how much you must pay each month in order to pay off the debt within three years.
The new regulations are designed to protect consumers from unscrupulous lending practices, to help them understand how their credit account works, and better manage their personal debt.
