Posted by Molly Nelson - The Federal Reserve's new rules for credit card companies go into effect this week.
Here is the Federal Reserve's outline of the changes that you should expect from your credit card company. Visit their Web site for more details.
Your credit card company has to tell you:
- When they plan to increase your rate or other fees.
- How long it will take to pay off your balance
New rules regarding rates, fees, and limits:
- No interest rate increases for the first year.
- Increased rates apply only to new charges.
- You must tell your credit card company that you want it to allow transactions that will take you over your credit limit.
- If your credit card company requires you to pay fees (such as an annual fee or application fee), those fees cannot total more than 25% of the initial credit limit.
- If you are under 21, you will need to show that you are able to make payments, or you will need a cosigner, in order to open a credit card account.
Changes to billing and payments:
- Your credit card company must mail or deliver your credit card bill at least 21 days before your payment is due.
- Payments directed to highest interest balances first.
- No two-cycle (double-cycle) billing.
[What You Need To Know: New Credit Card Rules]