In May of 2009, the United States Congress passed a bill regarding the Truth Lender Act, which is an act that governs control only over consumer credit. Stated with all of the information on the Federal Deposit Insurance Corporation (FDIC) website, this bill is to go into effect on Monday, February 22, 2010. With the economy in a downward spiral and many Americans drowning in credit card debt, our government is trying to gain some control and help credit card holders out. Finally it is a bill to help and assist us. Let’s go into detail about what this bill is going to entail for you as a credit consumers, and what this all means.
For a long time consumers have been pushing for reforms on the credit card companies and lenders. This act will mainly deal with enforcing interest rates. As long as the credit card consumer has paid bills on time and does not have a past due balance, the credit card lender will not be allowed to raise the interest rate. If they do wish to raise the current interest rate that is the credit card holder maintains, than they will have to give the customer a 45 day notice in advance of the majority of service fee charges or interest rate changes.
Pew, a non-profit research firm has released that an estimated $10 billion dollars will be saved overall by consumers with these minor changes in the Truth Lenders Act. This bill only affects personal credit card lending, and not business or corporate cards. However, a similar move for business and corporate cards is being considered, because it would help out small business owners everywhere a considerable amount.
Just because these changes are going into effect, doesn’t mean they are always going to be easy to catch. Make sure that you are always monitoring your credit card bills and statements. Go over all of your charges and look for information on upcoming changes for fees and interest rates. Read the fine print and know what you are getting into before you sign up on the dotted line. Interest rates are at an all time high right now so the more conscious you are about what is going on, the better. Debt is not the American dream, so don’t let yourself get swallowed in it like so many others. Take advantage of this bill and start tracking your credit card statements today.