Dishonest credit card tactics have cost people in the United States countless thousands of dollars. Scheduled to kick in on Monday, President Obama’s Credit Card Accountability Responsibility and Disclosure Act of 2009 will prevent additional losses from being tagged onto a country that’s already in a difficult position.

The facts are that credit cards companies have been jacking up card holder rates at a time when they need help with their finances. These lofty interest rate decisions  are extremely harmful to the financial well being of people who don’t have a more financially sound choice.

The CARD Act, signed into effect in May 2009 by President Barack Obama, changes the way that card companies can make money from their card holders. It used to be, card companies could make their own “judgements” as to how and why they raise their interest rates on the cards. President Obama and his administration have decided to step up to the credit plate  for consumers who saw this as a blatant loop hole that was behind exploited by ruthless creditors. Recognized as an outright crime on the citizens of our country, this practice will be done away with. 

“With this new law, consumers will have the strong and reliable protections they deserve.  We will continue to press for reform that is built on transparency, accountability, and mutual responsibility – values fundamental to the new foundation we seek to build for our economy,” President Obama said in May when the bill was signed.

Here are some of the protections coming to card holders this Monday:

  • Prevents Unfair Increases in Interest Rates and Changes in Terms
  • Prohibits arbitrary interest rate increases and universal default on existing balances;
  • Requires a credit card issuer who increases a cardholder’s interest rate to periodically review and decrease the rate if indicated by the review;
  • Prohibits credit card issuers from increasing rates on a cardholder in the first year after a credit card account is opened;
  • Requires promotional rates to last at least 6 months.
  • Prohibits Exorbitant and Unnecessary Fees
  • Prohibits issuers from charging a fee to pay a credit card debt, whether by mail, telephone, or electronic transfer, except for live services to make expedited payments;
  • Prohibits issuers from charging over‐limit fees unless the cardholder elects to allow the issuer to complete over‐limit transactions, and also limits over‐limit fees on electing cardholders;
  • Requires penalty fees to be reasonable and proportional to the omission or violation;
  • Enhances protections against excessive fees on low‐credit, high‐fee credit cards.
  • Requires Fairness in Application and Timing of Card Payments

So, in order to keep business completely honest, these new sanctions will be put in place to effectively secure both the anonymity and the interest rates of card holders through out the country. The fee for the credit law reparations will be returned to the U.S. Government in the form of fees and rate structures that are higher than what people are paying now. At least lives won’t get destroyed by greedy credit card companies who like to play with the very lives that allow them to live so luxuriously. 

America itself is in a transitional period that revolves around restructuring the economy to be a honest way to do business. Although the premise upon which finances are built isn’t perfect, neither is life itself. It’s only the irresponsible and people who think critical of others that hold us enslaved to our short comings!

It appears that the Obama administration has finally dealt a fantastic blow to the dishonesty and corruption within the debt servicing industry. Now, let’s see what they do about the foreclosure crisis and the millions of homeowners who are also being abused by the mortgage servicing industry that seems to have very little accountability from Washington over the last three years.

Moe Bedard
My name is Maurice "Moe" Bedard. I am the founder of America's #1 Mortgage Forum, My online work has been featured in the New York Times, LA Times, Fox Business, and many other media publications.