Got a Credit Card? You Need to Read This

Thursday, March 4th, 2010

The Fine Print on the New Credit Card Laws
If you’ve ever felt that it’s nearly impossible to read and understand credit card bills and rules, well… the federal government agrees with you. That’s why the Federal Reserve Board released a major overhaul Monday of the way credit card companies can solicit your business and inform you about rates and charges. Because many consumers still aren’t familiar with the new credit card laws, the Federal Citizen Information Center created these useful summaries and explanations:
• What the new laws mean (in plain English) – A good place to start – the Gov Gab blog entry on the subject
• Straight from the source – Learn about the new features on your credit card statement, calculate how long it’ll take to pay off your card balance and more on the new interactive Credit Cards website from the Federal Reserve Board
• Changes in gift cards– Besides changes in credit statements, your prepaid gift cards will experience some adjustments as well, including extended expiration dates and limits on fees
Get the news you need on money matters and other important consumer news with the Federal Citizen Information Center
How to handle credit cards !
Pay your bills on time, for one thing. The quickest way to get handed a higher interest rate is to be even a day late. Read your mail - credit card companies are under legal obligation to tell you whenever they make a change in your agreement. If they raise your interest rate, you can decide you don't want a card with that interest rate. At which point you opt out of that card. You stop using it and you have five years to pay back that debt – in most cases, at the old interest rate. Not reading your mail can mean that you do not read the notice from your credit card company when they change your payment due date. And the new credit card act, which went into effect Feb. 22, actually makes it easier on consumers. It will give us a little more time to make all these things clearer before they happen.

If you apply for credit and you're denied, get a secured credit card, which is attached to a savings account, a CD or some other form of collateral with the bank. These cards — the better ones, and you can find the list at www.cardweb.com — require that you pay your bills on time for 24-36 months and then they'll convert to a regular card. They’ll help you build your credit rating. We're hearing that banks are turning down people if they don't have incomes of $30,000 a year and credit scores of 720 and above.