The Senate passed the new Credit Cardholders’ Bill of Rights Act of 2009 yesterday. After the new credit card bill is worked out with the house, and the President signs it, the changes take effect in one year.
Credit Card Bill of Rights
Here is a summary of the changes included in the new credit card bill:
- Bills can be paid online or over the phone without incurring a processing fee.
- Customers must be over 60 days late on payments before their interest rate can be raised on balances; if the rate is raised, it will go back to the lower rate if customers make the minimum payment on time for six months in a row.
- Overlimit fees can’t be charged unless cardholders are told that the purchase will put them over their limit and they authorize it to go through anyway.
- If your card has more than one interest rate on balances, then payments must be applied to the highest interest rate first.
- Gift cards can’t expire for five years, and issuers can’t charge dormancy fees for unused amounts left on the card.
- Credit card statements must be mailed out 21 days before they’re due.
- Individuals under 21 will need a co-signer on their cards unless they can prove that they have the means to make payments on their own.
- Credit card agreements will have to be posted on the internet.
There is a lot of speculation [1] about what this will do to rewards cards, and other credit card perks. I think we’ll have to wait and see!
In the meantime, you can read the full text of H.R. 627: Credit Cardholders’ Bill of Rights Act of 2009 [2].
Source: Consumer Reports [3]