Credit Card Regulation Changes

Understanding the new credit card rules starts with one easy step: reading your mail. Ray Martin explains.

This month major changes are coming to your credit card thanks to new government regulation. Your credit card company should mail you information on how these changes are going to affect you. Make it a priority to read these details. Here's why: In many ways the new law protects consumers, it limits how and when banks can raise interest rates and fees. It ensures that the amount you pay over the minimum is used to reduce the portion of your balance with the highest interest rate. It requires companies to mail your bill at least 21 days before its due and this all sounds good right? But read between the lines and you'll see the regulations make it more difficult for credit card companies to make money. So you can be sure they'll be thinking of new ways to turn a profit. After all the law doesn't prevent banks from dreaming up new fees and this has already begun. For example, some cards are adding inactivity fees for customers who don't spend enough on their cards and look for more credit cards to begin charging annual fees. Banks are required to tell you about all of these changes but you won't know about them if you don't read your mail. You'll also want to read your credit card statements carefully too just to make sure that the changes are actually being applied correctly. So get to it and I hope you check another item off your financial to do list next month.