HARTFORD -
Brace yourself, chances are, during the next few days you may get the word that your credit card interest rate is going up even if you've done nothing wrong. It doesn't matter if you've paid your bills on time and or have excellent credit. That's because even with some provisions of the new credit card reform law set to go into effect next week, there appears to be some wiggle room for credit card companies to cash in right now by raising interest rates rate now.
State Attorney General Richard Blumenthal says his office has received hundreds of complaints from consumers who say their credit card companies are unfairly raising rates.
"These companies are essentially trying to beat the deadline and circumvent the law by changing their terms of interest rates, fees, and notice requirements before they are under the mandatory provisions of the new law," Blumenthal said.
A spokeswoman for Senator Christopher Dodd, who authored the Credit Card Reform legislation, said what credit card companies aren't telling you is that when the bulk of the new law goes into effect in February of 2010, credit card companies will have to answer to Federal Regulators as to why they raised rates on customers through out all of 2009! If there is no valid reason for the rate hike, credit card companies could be forced to lower their rates to what they were before the increase.
As of next week, two provision of the law will go into effect. One will give consumers more time to pay their bills. As of August 20th, credit card companies will have to mail-out bills at least 21 days before they are due. Credit Card companies will also have to give customers 45 days notice of a rate hike. The idea here is that people will have more time to shop around for a better deal instead of just getting socked with a higher interest rate overnight.
As mentioned, the bulk of the law goes into effect early next year which includes parental consent for minors who want credit cards. Also, credit card companies will only be able to raise rates if a payment is 60 days late. Right now, companies can raise rates if a payment is late by just one day.
State Attorney General Richard Blumenthal says his office has received hundreds of complaints from consumers who say their credit card companies are unfairly raising rates.
"These companies are essentially trying to beat the deadline and circumvent the law by changing their terms of interest rates, fees, and notice requirements before they are under the mandatory provisions of the new law," Blumenthal said.
A spokeswoman for Senator Christopher Dodd, who authored the Credit Card Reform legislation, said what credit card companies aren't telling you is that when the bulk of the new law goes into effect in February of 2010, credit card companies will have to answer to Federal Regulators as to why they raised rates on customers through out all of 2009! If there is no valid reason for the rate hike, credit card companies could be forced to lower their rates to what they were before the increase.
As of next week, two provision of the law will go into effect. One will give consumers more time to pay their bills. As of August 20th, credit card companies will have to mail-out bills at least 21 days before they are due. Credit Card companies will also have to give customers 45 days notice of a rate hike. The idea here is that people will have more time to shop around for a better deal instead of just getting socked with a higher interest rate overnight.
As mentioned, the bulk of the law goes into effect early next year which includes parental consent for minors who want credit cards. Also, credit card companies will only be able to raise rates if a payment is 60 days late. Right now, companies can raise rates if a payment is late by just one day.
