New Federal Reserve Credit Card Rules

New Federal Reserve Credit Card Rules Protect Consumers


New credit card rules issued by the Federal Reserve add consumer protections to the 2009 credit card law, including limits on penalty fees and a re-evaluation of recent interest hikes.  Since the law was passed last May, credit card companies came up with creative new fees & penalties. The new credit card rules announced Tuesday, June 22, 2010, go into effect August 22nd, 2010.  The provisions close some loopholes & complement rules in 2009 credit card law already in effect.

–        Credit card late fees cut

New penalty fee limit of $25.00.  There are some exceptions – if the payment is late a second time in a six month period, the credit card company can charge a $35 late fee.  Until August 22, 2010, most credit card late fees are $39.00.

–    Credit card penalty fees limited


The new rules limit penalty fees for exceeding credit limits.  The penalty fees cannot exceed the dollar amount of the consumer’s violation.  For example, a credit card company can no longer charge a $39 fee when a customer exceeds the credit limit by $20.  Now the fee cannot exceed $20.  But that consumer could still face a permanent penalty hike on his interest rate on future purchases.  Credit card companies can no longer charge an inactivity fee on cardholders who don’t use their cards.

–    Credit card interest rates re-evaluated

New credit card rules require issuers to review high credit card interest rate hikes inflicted on consumers since January, 2009.  If your credit card company raised your interest rate after January 1st, 2009, it will have to re-evaluate its reason for doing so and potentially lower the interest rate if it finds that those reasons no longer apply.


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