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July 7th, 2008

Comment on Credit Card Regulations

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The Fed is inviting the public to comment on their latest proposal of rules aimed at cleaning up the credit card industry. Already more than 9,300 opinions have been expressed, and with an August 4 deadline, time is running out to let your voice be heard.

HSH published a news story back on April 25, dubbed “The Credit Cardholders’ Bill of Rights,” which detailed a proposal by Rep. Carolyn Maloney, D-NY. Along with proposals from other various lawmakers, these amendments will help shape the Fed’s new regulations;

“The ‘Bill of Rights’ aims to corral such practices as unannounced rate increases, unannounced changes in due dates, universal default – in which a non-payment to another creditor increases the card’s interest rate – and two-cycle billing, in which interest is charged to the previous month’s balance even if the bill has been paid off.”

The Fed released a statement back in May which detailed the five main regulations of the proposal. Banks will be prohibited from increasing rates on pre-existing credit card balances, applying payments aimed at increasing interest charges, and imposing two-cycle billing. Banks will be required to provide reasonable time for consumers to make payments – Senator Chris Dodd, D-Conn., proposed that banks mail credit-card bills 21 instead of 14 days before the bill is due – and banks must allow customers full benefits to discounted promotional rates. While consumers are praising the initiative, banks are criticizing the regulations, fearing consumers will face higher prices, fewer choices, and less competition that won’t allow credit-card companies to offer better deals.

“The proposed rules are intended to establish a new baseline for fairness in how credit card plans operate,” said Federal Reserve Chairman Ben S. Bernanke.

To comment on the latest regulations click here. All comments are available to the public, along with names and addresses.

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5 Responses to “Comment on Credit Card Regulations”

  1. Theral Golden Says: September 18th, 2008 at 5:28 pm

    What the credit card companies are doing now is usury and you and the congress are coconspirators. These propose changes do not go for enough. The most important thing is the calculation of the due date itself and what is a late payment. You should have at less a seventy two hour grace period. This should balance out the fact that it takes credit card companies at less that much time two process your payment after they receive your payment.

  2. Tim Manni Says: September 19th, 2008 at 3:47 pm

    Theral Golden — I agree with you about the grace periods — even when paying online through your bank, it can take a few days for the payment to go through, then your hit with a late charge, it does seem unfair. Don’t be too upset though, at least they’re are attempting to make changes, they could be doing nothing at all…Check out our post on the proposed new credit card regulations
    (http://blog.hsh.com/?p=111) and this about how desperately its needed
    (http://blog.hsh.com/?p=112)

    Thanks for reading,
    Tim

  3. jerrialchristian Says: December 2nd, 2008 at 9:41 am

    There are so many rules & regulations for credit cards but i think they all are for security purpose.And if those regulations are in oppose to the customers then the customer should not let it go.

  4. Tim Manni Says: December 2nd, 2008 at 3:40 pm

    jerrialchristian —

    Thanks for reading, we appreciate your comments. I do agree that credit card companies enable these changes to protect themselves, but at what cost to their customers? Don’t you think the customer should be the top priority?

    Thanks again for reading and commenting, we hope to hear from you again soon!

    -Tim (HSH)

  5. FinancialServicesRenoNV Says: March 28th, 2009 at 5:37 pm

    Greetings all members,

    I would just like to say hello and let you know that I’m happy to be a member – been a lurker long enough :)

    Hope to contribute some and gain some knowledge along the way….

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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