Attorney General Jackley Tells Consumers to Prepare for Changes in Credit Card Rules
PIERRE, S.D.- Attorney General Marty Jackley announced today that the national Credit Card Act will go into effect on February 22, 2010. This Act will limit some interest rate increases, require more disclosure to customers and prohibit banks from raising interest rates on current balances unless a consumer is at least 60 days behind in a payment. These new rules will address certain business practices of credit card companies, which could cost the industry billions in revenue. As a result, changes from the industry to recoup these loses could result in personal and financial impacts and changes to personal credit scores. Credit card companies have already begun making some adjustments and consumers need to be aware of the changes that might affect them.
“Credit card companies are beginning to make adjustments to fees and consumer contacts before the new law goes into affect,” said Jackley. “As a result, our Division of Consumer Protection is experiencing an increase in credit card complaints where consumers are being charged for new fees and products. These complaints include higher interest rates and payments, and more fees - such as annual fees, inactivity fees and processing fees.”
Banks must give you notice when they are changing the interest rate or changing the terms of the contract. If you don’t accept these changes they can close your card and you will have 5 years to pay off the card at the old rate. Or, they can require a minimum monthly payment equal to a percentage of the balance that is no more than twice the percentage required for the old minimum payment. Closing your card may affect your credit score so you should look for new credit before your close the credit card account voluntarily. It is imperative that you open all documents from your bank or credit card company and read all the fine print as to any changes or disclosures they may be making.
If you have a complaint, contact the Consumer Protection Division at 1-800-300-1986 or firstname.lastname@example.org.