Credit Card Act of 2009 about to kick in

[30ashopper]

The nation's banks will be bombarding customers with new fees and products in 2010 as they try to replace more than $50 billion in revenue wiped out by new rules that clamp down on certain business practices.

So far, the changes are mostly concentrated in checking accounts and credit cards. In addition to attaching new fees to old products, banks are introducing new types of accounts that they hope will reel in new customers and reduce their funding costs.

For plastic, the new rules go into effect in February as part of the Credit Card Act of 2009. The rules will limit some interest-rate increases, require more disclosure to customers and prohibit banks from raising interest rates on current balances unless a customer is at least 60 days behind in a payment.

Credit-card issuers collected $22.9 billion in penalty fees—such as those assessed for late payments—in 2009, up from $19 billion in 2008, said , who runs a credit-card consulting firm in Thousand Oaks, Calif.

Credit-card companies already have been racing to slip new fees and practices into customer contracts ahead of the law. Issuers are closing accounts, switching cards with fixed interest rates to variable rates and introducing cards that have an annual fee.

Banks Roll Out New Check, Card Fees - Yahoo! Finance

The biggest change that will effect strung out consumers is the restriction on overdrafts. Without the ability to charge a fee when someone overdrafts, banks will refuse to honor purchases. Expect to see a quite few folks getting flustered in check-out lines and restaurants starting in Feb..

 

[Alicia Leonard]

Banks Roll Out New Check, Card Fees - Yahoo! Finance

The biggest change that will effect strung out consumers is the restriction on overdrafts. Without the ability to charge a fee when someone overdrafts, banks will refuse to honor purchases. Expect to see a quite few folks getting flustered in check-out lines and restaurants starting in Feb..

I guess I'm old-school. Always balance my check book and don't use overdraft. I will be canceling one card that will start trying to charge me a membership fee, but other than that shouldn't affect my everyday life.

 

[Lynnie]

The overdraft fees have become a huge money maker for banks on the debit/check card purchases.

Money not available and someone swipes their card, bank approves a $2 cup o' joe at Starbucks and immediately debits the account their resepctive OD fee......upwards of $40 for some banks. Charge should be declined IMHO. Glad to see this one go into effect.

What the CC cos. did to beat the clock is reprehensible. Many raised int. rates to 29.99% on some people so the rate could be grandfathered prior to the inception of the legislation.

Bush tried to abate this, but gave them too much time to swindle......again, just my opinion.

 

[scooterbug44]

I don't understand overdrafts either - but I also don't have 8k in credit card debt like the average American.

But I have gotten letters from the 2 store cards I have telling me about increased interest rates and other ways they plan to screw me over - including charging me $1 for every paper statement. Yes, they want to charge me to send me a bill!

Adios cards!

 

[30ashopper]

I worry mostly about good customer fees. I've heard banks are going to punish responsible consumers who pay off their bills every month with yearly service fees. Switching banks would be a pain in the ars, but I'd do it if they tried to charge me a service fee for something they are already making a good percentage on.

 

[scooterbug44]

The fact that they would even CONSIDER something called a GOOD CUSTOMER fee shows just how illogical and screwed up our banking and financial systems are.

Any bank that tries to slap me w/ a "good customer fee" is going to be losing a customer..........................and any elected representative w/ jurisdiction over them will be getting informed of my thoughts on giving them any of our tax dollars.

 

[Lynnie]

I worry mostly about good customer fees. I've heard banks are going to punish responsible consumers who pay off their bills every month with yearly service fees. Switching banks would be a pain in the ars, but I'd do it if they tried to charge me a service fee for something they are already making a good percentage on.

Carry a balance for 60 days, then? Depending upon how much you spend each month, this will most likely be cheaper than the annual fees. Just a suggestion.

I feel badly for those who are truly in a hardship and now will be paying higher int. because of their hardship. It seems these need a break and I am not talking about those who overspent and didn't save......rather, true hardship individuals.

 

[scooterbug44]

Carry a balance for 60 days and it hurts your credit score (which I think is one giant self perpetuating crock anyway).

Screw 'em and go to a bank that DOESN'T charge those fees. Only way to teach them a lesson.

 

[Lynnie]

Carry a balance for 60 days and it hurts your credit score (which I think is one giant self perpetuating crock anyway).

Screw 'em and go to a bank that DOESN'T charge those fees. Only way to teach them a lesson.

Does it really? Is that part of the new legislation? Now, it's a factor of balance to limit.....is your score seriously hurt for carrying a 60 day balance?

Strange times, indeed!

 

[scooterbug44]

No, I was thinking of not paying it for 60 days.

Still think the whole credit score thing is a giant steaming pile though.