House Passes Bill Moving UP Implementation DATE of bill Stopping Abusive Practices by Credit Card Companies. Hey SENATE are you listening??? This needs to happen ASAP!
After President Obama signed a credit card reform bill in May preventing the credit card industry from assessing arbitrary fees and interest rate hikes to consumers, the credit card industry responded by immediately and arbitrarily increasing interest rates, increasing fees, raising rates retroactively on existing balances, etc. in an effort to maximize its profits and gouge consumers even more before the new rules take effect in February 2010. A pew report revealed that every online credit card carrier was using some form of unfair and deceptive practice.
One hundred percent of credit cards offered online by the leading bank card issuers continue to include practices that will be outlawed once legislation passed in May takes effect next year, according to a new report by the Pew Health Group’s Safe Credit Cards Project. The report also found that advertised credit card interest rates rose an average of 20 percent in the first two quarters of 2009, even as banks’ cost of lending declined.
Well the House has responded to such tactics by moving up the start date to December 1, 2009. The House moved the implementation date up to the day the President signs the bill into law. The Maloney-Frank bill received wide bipartisan support in the final floor vote of 331 to 92. Below is the current schedule given because the credit card companies deceptively claimed that they needed time to adjust their systems in order to implement the new rules.
The current schedule. The first portion of the reform act went into effect in August, requiring banks to give 45 days notice on major changes to a contract, including rate hikes. Issuers must also give consumers 21 days notice before a bill comes due.
Also, customers now have the right to reject changes to their contracts — if they do so, they can pay off their balances at their existing rates within five years.
The second part of the reform is currently slated to kick in next Feb. 22. Major changes include prohibiting arbitrary rate increases on existing balances, and requiring that customers opt into the ability to overdraw their accounts.
The third portion is scheduled for Aug. 22, 2010. It calls for “reasonable and proportional” penalty fees, and would require that issuers review all interest rates and reduce them where warranted.
Thanks to the House now we need the Senate to pass this ASAP!
