How Your Student Credit Cards Are About to Change
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by: barrywaters
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Word Count: 460
Starting on August 20, 2009, owners of student credit cards will have new control over their credit cards, and new federal controls over what credit card issuers can and cannot do, thanks to the Credit CARD Act of 2009. The new laws will go into effect in stages. The biggest changes are coming in February 2010, and the last stage wont hit until May 2011. However, the very first provisions will start giving credit card owners relief on August 20th.
On that date, these new limits take effect:
* Credit card companies are required to give 45 days warning before changing the terms of consumers credit card agreements. The old limit was 15 days warning, a term that was so short that consumers often didnt receive the letter warning them of oncoming changes until the date of the change had arrived. This new federal limit will give you plenty of warning of changes to your student credit cards, instead of getting announcements belatedly or with too little time to do anything.
* Credit card companies must mail monthly statements to customers at least 21 days before the account is due. This change puts an end to an old trick unethical companies liked to play: sending out monthly statements so late that customers couldnt pay on time, leading to late fees, raised interest rates, and other sources of "free" money for the credit card company. The change also gives you more time to budget for your student credit card bills, lessening the chance that you will pay late.
* Consumers will be able to opt out of fee hikes and interest rate increases at their discretion. If they refuse the credt card companys proposed fee or rate hikes, their account is closed, but they may pay off the remaining balance under the more favorable terms they had beforehand. For instance, if your issuer hikes your interest rate from 11% to 15%, you may refuse the increase, close your account, and pay off your balance at the 11% rate. This provision of the Credit CARD Act turns what used to be a privilege offered at the credit card companies discretion into a consumer right.
Impressive changes! And even more profound changes are coming soon. But take care: Credit card issuers are rushing to amend their terms before the Credit CARD Act of 2009 changes the rules. Card companies everywhere are hiking their interest rates and fees, and consumers report waves of sudden credit card cencellations. So watch your mail and cross your fingers. The credit industry is about to be overhauled for the better, and your student credit cards are about to become even less risky.
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Similar sites about student credit cards, go by getsmart.com/credit-cards.
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