The Senate Banking Committee is creating quite a stir this week with a push to move up the 2010 credit card reforms and tack on some new restrictions for borrowers under 21. Here's Senator Chris Dodd talking about his motivations:
Read the latest details about what these credit card reforms might include and the response from the banking industry.
For consumers, the early arrival of these reforms could be a mixed blessing. Yes, you'll get the new protections including no retroactive rate increases, limits on fees and payments not allowed to be applied to only the balance with the lowest rate. But you could also see credit card interest rates increases or more term changes come sooner as the issuers try to preemptively take action to protect themselves from the changes.
What do you think of this news? Would you welcome the earlier reforms or are you worried about the impact it might have on your credit cards now?
Emily Peters – Credit.com's personal finance expert and former TransUnion credit bureau insider. Emily writes about credit reports, credit cards, loans and personal finance as the CreditBloggers.com editor.
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Speeding up the consumer protections probably doesn’t alter the fact that the credit card companies were going to increase rates and all that next year when the reforms kicked in. They probably knew what changes they were going to implement in 2010, so they can just implement them sooner.
Might as well get it over with, right?
According to the latest timeline released by the committee, implementation 9 months after approval, this might only speed up the reforms by a couple months.
Hi Emily: They have got to stop that universal default clause. That is wrecking financial havoc with consumers!
Home Depot just raised my rate on an existing line of credit not because I don’t pay on time according to the company but because others don’t. When I asked to optout the first rep said I was too late. The second said I was late but they’d accept it. It appears the credit card companies are now trying to maintain profits on the backs of the few who are actually paying. They’re going to get their profits in before the new legislation takes effect.
Home Depot just raised my rate on an existing line of credit not because I don’t pay on time according to the company but because others don’t. When I asked to optout the first rep said I was too late. The second said I was late but they’d accept it. It appears the credit card companies are now trying to maintain profits on the backs of the few who are actually paying. They’re going to get their profits in before the new legislation takes effect.
I would hope that Senator Dodd does something about Bank of America’s recent jacking-up of their interest rates on even their best customers. Do something positive for a change that is, before Senator Dodd’s constiutents boot him out of office for his incompetence.