Think You Understand the New Credit Card Laws? Think Again

Beverly Blair Harzog
Huffington Post

Sure, the Credit CARD Act was a step in the right direction. We all have a little more consumer protections than we did before. But as we’ve seen too often, when Washington tries to fix our problems, the legislation gets watered down to the point where the language is, well, wishy-washy at best. Here are just a few of the areas where the vague wording of the CARD Act gives credit card issuers a little too much wiggle room.

Regular Interest Rate Hikes

Many consumers think that the law protects them against rate hikes. This is true, but only to a point. You’re only protected during the first year of a new account (with a few exceptions, such as variable rates that are tied to an index). But what about that $2,000 balance you have on the card you’ve had for three years? The CARD Act prohibits retroactive rate increases on existing balances. But your rate on that card can increase “significantly” on your future purchases as long as you’re given 45 days’ notice.

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