WASHINGTON, DC – Congresswoman Niki Tsongas says that a series of landmark reforms to the way the credit card industry does business have now gone into effect “thanks to the Credit CARD Act (Credit Card Accountability and Disclosure Act).”
In a press release, Tsongas said, “The law, which was passed by this Congress and signed by President Obama last year, ends unfair industry practices and protects consumers from abusive tactics like retroactive rate increases, misleading late fee charges, and over-the-limit fee traps.” Tsongas was a cosponsor of the legislation, which was passed by a strong bipartisan majority in both the House and Senate.
“The deceptive and abusive practices that the credit card industry has long employed run contrary to the interests of consumers, and, as we have seen from the recent financial crisis, also have dire consequences for our economy as a whole,” Tsongas said. “The common sense reforms that have now gone into effect as a result of the CARD Act rein in the worst practices of the big credit card companies, banks and other large financial institutions, placing the consumer on a more level playing field.”
“Now that these new reforms are in place, credit card companies are already looking for ways to circumvent them. It is important that you know your rights as a consumer. I encourage Fifth District residents to visit The Federal Reserve’s Consumer Information website or my website for more information about your rights,” Tsongas concluded.
Tsongas says that the key changes credit card holders can expect include:
* Credit card companies must give at least 45 days notice before increasing your interest rate, changing certain fees, or making other significant changes to the terms of your card.
* Any changes to your billing will require a statement detailing those changes at least 21 days before the payment is due.
* Credit card bills must provide information to clearly explain how long it will take to pay off your balance if you only make minimum payments.
* Credit card companies will be restricted from charging card holders for over-the-limit transaction fees without the card holders’ consent.
* Interest rate increases will, in most cases, be prohibited during the first year of the life of an account.
For more detailed information on the new consumer protections for credit card users, visit The Federal Reserve’s Consumer Information website: http://www.federalreserve.gov/creditcard/