As the Credit Card Reform Act takes effect, you may discover that there are many changes to current terms and conditions. One area that has made some changes is that of interest rates. Much has changed about interest rates, but there are also some aspects of this act that have left things exactly the way they are. The changes made are meant to improve and reign in the credit card companies, and their practices and policies. The Act aims to help consumers better understand the terms and conditions of their credit card companies, what they do, and why.
Interest Rates:
Today I will be talking a little bit about Interest Rates and what exactly is happening with the interest rates in response to the Reform Act.
Changed:
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Credit Card companies cannot raise interest rates on existing balances found on cards.
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If you open a new Credit Card account companies cannot raise interest rates for 12 months.
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Consumers can no longer receive hiked interest rates on money they have already borrowed.
Not Changed:
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There are no limits to the rates card companies can charge new customers.
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It also has no regulations on how much rates can raise on future purchases made.
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The changes made on the interest rates have reporters and legislators predicting that original rates and changing rates will most likely start higher than before so as to keep the money flowing and the income for companies’ high.
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Because of these reforms, banks have moved slightly away from fixed-rate cards.
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There are low introductory rates that are most likely to be raised after the first year, or six months, so be sure to read the fine print.
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If you are late on a payment, especially if you are over 60 days late, but are working on payments, the old interest rate must be charged instead of the new one,even if the company must revert back.
As you can see there are many ways that Credit Card reform can effect you,even when just speaking of interest rates. Check back with us daily to learn more about this large Credit Card Reform Act to see how it could affect you and your family. Check City has great rates on its fixed price Prepaid Debit Cards. With our netspend Prepaid Debit Cards, you bring the money to us that you want on the card, and when that money runs out, you must reload the card in order to use it again. There are no interest fees involved and with various options available its easy to add money to your card, pay bills, or manage your account no matter where you are.
