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THURSDAY, MAY 28, 2009
Card Sharps
Congress overwhelmingly passed and the president
signed legislation last week that represents
a major victory for American consumers.
Mirroring recent nearly identical actions taken by the Federal Reserve, the bill also underscores American’s anger at companies that issue credit cards. It’s one thing for the Fed to buck powerful lobbying interests so decisively; it’s something else entirely for elected officials to do so.
There will be new restrictions on when and how card companies can increase the interest rate on balances you’ve already accrued.
Most importantly, the bill says that banks generally must wrait until you’re 60 days late in making a minimum payment before applying a penalty interest rate to your existing debt. Pay on time for six months, and the lender is required to restore the previous, lower rate.
We have written before about how self-defeating it is that credit companies now routinely raise interest rates to about 30 percent on delinquent accounts.
93.6%