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New credit rules could make for a happier 2010 for consumers

Credit card rules that go into effect in 2010 will curb issuers' ability to raise interest rates and impose over-the-limit fees.
Credit card rules that go into effect in 2010 will curb issuers' ability to raise interest rates and impose over-the-limit fees. (Jb Reed/bloomberg News)
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By Michelle Singletary
Thursday, December 31, 2009

I'm happy to see the end of 2009.

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It was a tough year of painfully high unemployment and rising foreclosures and debt levels. It was hard to see so many people I care about lose so much.

But I'm excited about what 2010 will bring. Already things are turning around. We are not clear of the burdens of the recession, but we are getting closer.

I especially love that in 2010, consumers will see a lot of changes in how they are treated by their lenders. And I'm hoping that next year, people will have an easier time accessing their free credit reports.

I'd like to think of 2010 as the Year of Consumer Power.

Do you know what your new powers will be? If not, here's a roundup of some key rule changes that you need to keep an eye on in 2010:

-- Credit cards. This is the biggie. The Credit Card Accountability, Responsibility and Disclosure Act of 2009 (also known as the Credit CARD Act) established sweeping changes intended to help prevent crazy credit card fees and hefty interest rate increases. Companies will be required to make more disclosures and they face new limits on certain credit card practices.

Regulations relating to interest rate increases, over-the-limit transactions, and the marketing of credit cards to college students become effective Feb. 22. For example, credit card issuers will not be able to increase interest rates on existing balances unless a cardholder is at least 60 days late paying the bill. Credit card issuers can't impose over-the-limit fees unless a consumer has given the company permission to accept transactions that go over his or her credit limit.

In other changes starting in February, if your credit card due date falls on a weekend or holiday, issuers can't penalize you for being late if the payment comes in the next business day. Additionally, payments received by 5 p.m. must be credited the same day.

By July, if your interest rate was increased because you were 60 days late on a credit card payment, your issuer will have to revert back to the original rate if you've had six months of on-time payments.

The same law that expanded the protections on credit cards also included changes for gift cards. In July, new rules will limit fees on gift cards and stored value cards. The remaining provisions of the Credit CARD Act become law on Aug. 22. For instance, the Federal Deposit Insurance Corp. says at least every six months, card issuers must review interest rate increases dating back to Jan. 1, 2009.

If you want more information on the provisions that will go into effect, go to http://www.consumer-action.org. In the search field, type in "New credit card provisions."


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