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New Credit Card Rules Go Into Effect This Month

I dare say that not a lot of credit cardholders are aware of this but some new rules regarding their credit card accounts will go into effect this month.

One rule is designed to make sure that credit card issuers are more diligent in checking out who is, and is not, a good risk with regards to actually paying their credit card bills.

Case in point; a married man that is a stay at home dad with no income will not be able to claim his spouse’s income as if it were his own. In other words, household income no longer will be a factor in deciding who will be approved for a credit card.

Of course, the nonworking spouse can always apply for credit as long as they do so is a joint account along with the income earning spouse (who must be a cosigner). It’s all about proof of income.

This is going to make it harder for many individuals to get credit on their own. While some will surely disagree with this, it actually is a responsible measure that is necessary in light of the rash of defaults we’ve experienced in recent years.

Along the same lines, college students will no longer be able to claim household income when they apply for a credit card.

Promised Interest Rates

The new rules also deal with promised interest rates from credit card issuers making it more difficult for them to raise rates. The day of the teaser rate seems to be numbered as issuers will be under pressure to abide by the interest rate that was offered when the card was originally issued.

Notification must be given in advance if and when interest rates will be raised. They will no longer automatically go into effect after X amount of days without first letting the cardholder know about it.

These new rules are simply a continuation of the CARD Act that went into effect in phases last year. They are designed to protect consumers from what are seen as predatory practices by credit card companies.

And, of course, the cat and mouse game will continue as these very same credit card companies look for other ways of recouping the lost revenue from the recently enacted regulations. As always, we here at will keep you abreast of the latest developments.

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