rssDems: New Credit Card Regs Are No Substitute for Legislation
Thursday, December 18, 2008 at 4:12 pm
- 9 Comments
After months of proposals, arguments, hearings and public comments, federal regulators today approved new rules to make credit cards more consumer friendly. The changes will prevent card companies from hiking interest rates on existing balances and grant card users a longer window to pay their bills. The new rules take hold in July 2010.
Some Democrats aren’t impressed.
Sen. Carl Levin (D-Mich), who heads a Senate investigative panel, issued a statement this afternoon saying the regs are “a good first step” but don’t go nearly far enough to rein in the industry’s abusive practices:
The regulations regrettably leave in place many blatantly unfair credit card practices that mire families in debt. Legislation is needed to stop abuses such as charging interest on debt that was paid on time, pay-to-pay fees, and universal default.
Rep. Carolyn Maloney has such a bill. In a statement released today, the New York Democrat applauded the Fed’s changes, but said they won’t come quickly enough to help consumers during the recession. “Congress should act sooner to protect American consumers by giving credit card protections the permanence and force of law,” she said.
Republicans had opposed Maloney’s bill, largely on the grounds that federal regulators were working to craft similar changes. During numerous hearings on the proposal, they claimed that Congress should wait for those regs to arrive before pushing forward with legislation — a notion soundly rejected by Democrats.
“The notion that the legislative body should defer to the regulators gets it backwards,” Rep. Barney Frank (D-Mass.), chair of the House Financial Services Committee said during an April hearing on Maloney’s bill.
Now that the regs have arrived, Republican critics can’t lean on that wait-and-see argument any more. Still, with the banks struggling in the downturn, Maloney and her supporters might have a tough time convincing colleagues that 2009 is the right time to cut into profits further — even in the name of helping consumers.
9 Comments
Comment posted December 19, 2008 @ 12:40 pm
This is not even a good first step, consumers need relief right now –not in 2010. How can anyone who is already financially strapped due to the recession, and possible loss of job, pay 20-30% rate hikes for another 18 months? We gave tax payer money to the banks for a bailout or “so they can provide credit to mainstreet” and then we allow the banks to charge the taxpayer 30% to use that money the taxpayer loaned them??? WHAT IS WRONG WITH THIS PICTURE??
Comment posted December 20, 2008 @ 8:36 pm
The changes on credit card legislation will have absolutely no real impact on consumers and their use of credit cards.
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http://pacificgatepost.blogspot.com/2008/12/ber…
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Issuers will continue to be abusive of all card holders.
Comment posted December 29, 2008 @ 8:27 am
I have just been informed that First USA< Cardmember Services, is tacking on a $10.00 per month Finance Charge to a 5.99% fixed APR account I have with them. The original agreement was a promotional 5.99% fixed rate until the balance is paid off provided I made my payments on time, which I have done. I protested this charge and have been advised that they will offer me a 7.99% rate until 1-1-2011 and then will increase to their variable rate. They have violated their original agreement with me and are trying to change the horse in the middle of the stream, so to speak. This is just another way apparently to get around the new regs regarding credit card companies.
Comment posted December 29, 2008 @ 8:33 am
I have just been informed that First USA< Cardmember Services, is tacking on a $10.00 per month Finance Charge to a 5.99% fixed APR account I have with them. The original agreement was a promotional 5.99% fixed rate until the balance is paid off provided I made my payments on time, which I have done. I protested this charge and have been advised that they will offer me a 7.99% rate until 1-1-2011 and then will increase to their variable rate. They have violated their original agreement with me and are trying to change the horse in the middle of the stream, so to speak. This is just another way apparently to get around the new regs regarding credit card companies.
Comment posted May 12, 2009 @ 3:14 am
This is a great idea..If credit card becomes consumer friendly then the number of card appliers will increase..
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Comment posted August 27, 2009 @ 8:19 am
The factor that I use to select the credit card is the advantage that I can get. If it's no impact and more advantage (such as cash back program). It would interest me very much.
Comment posted January 3, 2010 @ 1:30 am
It's quite large percentage for APR, for my opinion. I prefer for less than this.
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