New Credit Cards Rules Coming Monday
Starting tomorrow big changes that will impact every credit card you own.
A new law takes effect that slaps new restrictions on credit card companies. It's supposed to protect you. But the law also creates new ways for the banks to squeeze you.
You'll spot the changes, the moment you open your next bill.
Right there in black and white – the math you've been avoiding. By law, your bank MUST NOW spell out HOW LONG IT WILL TAKE YOU TO pay off your card.
Say your balance is three-grand at 14 percent interest. With the minimum monthly payment, it'll take you a more than a decade!
Pamela Banks, Senior Policy Council, Consumers Union said, “What it means for consumers is that they will have the information they need in order to better manage their credit card.”
Here's what the credit card companies CAN'T DO under the new law:
1)They can't move your due date to trick you into a late payment.
2) They can't charge you for going over your limit unless you agree.
3) They can't raise your interest rate without 45 days notice, and if they raise your rate for late payment, they've can't keep it high if you pay on time for six months.
Those changes will cost the credit card companies an estimated $50 billion dollars over the next five years. But there is room under the new rules to get some of that money back.
So here's what the card companies CAN do: Charge new fees, for things like paper statements, overseas transactions, even for not using your card often enough. They can also raise your minimum payment, and of course, raise your interest rate which is something they have been doing for months.
Consumer groups say the law is a good first step in shielding customers from the more outrageous tactics of the credit card companies but those companies still have some tools left, so customers still need to be alert..