New Law Affects Credit Card Companies And Customers

Wednesday, August 19th 2009, 5:09 pm
By: News On 6

By Emory Bryan, The News On 6

TULSA, OK -- A new law goes into effect Thursday that is designed to protect credit card holders from outrageous fees and unexpected changes.

One big change is that customers will have the right to reject a rate increase - and five years to pay it off under the existing terms. Some companies allowed that, but now it's the federal law.

The changes designed to protect consumers also mean people need to be extra careful reading their statements, according to the Better Business Bureau.

"Consumers really need to pay attention because I've got a feeling a lot of them are going to find out their interest rates have been jacked up in the last 48 hours trying to meet that deadline," said Rick Brinkley, Better Business Bureau.

Rick Brinkley of the Tulsa's Better Business Bureau says the changes will be good for consumers - but leading up to the new law, some credit card terms have actually gotten worse.

"The credit card companies know exactly what the laws are, the deadlines are, to increase fees and increase interest rates and they're going to do what they can to make that happen and stay within the law," Brinkley said.

The old rules require credit card companies to give 15 days notice of changes in terms.  The new rule requires 45 days notice.

The old rule required companies to give consumers 14 days to pay their bills, the new rule is 21 days.

Credit card companies must also give consumers the chance to reject a rate increase and keep the existing terms.

The changes will benefit some - but could backfire on customers with less than perfect credit.

The effects of the new law could be new limits on credit - higher payments, higher rates, higher fees and some might find cards are harder to get.

Regardless the credit companies will have to give their customers more notice - of any changes.

"This law is going to require them to give you that kind of advance notice so you do know what's going on," said Rick Brinkley of the Better Business Bureau.

Learn about the surprising change the Better Business Bureau has seen since the downturn of the economy by watching a web extra attached to this story.