New Changes In Credit Cards For Both Old And New Accounts

As most people have heard in the news lately, there are many new regulations that went into effect concerning credit cards. These new laws have provided consumers with many new protections. However, it must be noted that with these protections come some new ways for banks and lenders to add charges to your cards.

Changes in Credit Card Late Fees

Banks can no longer charge high fees for late payments or for being over the limit. They also can no longer charge you a late fee for paying your bill on the due date or the immediate day after. Fees can no longer exceed your monthly minimum payment or $25, whichever is higher. While this is a great thing for the consumers, banks stand to lose billions of dollars in fees each year. Credit card holders should anticipate that their credit card bill payments will increase to a minimum of $25 dollars each month.

New Credit Scoring

Your credit score is one of the main factors that banks use to determine your interest rates. You can count on a new scale to emerge from the industry. This new scale will encompass a larger set of variables to determine interest rates. It is the only logical way they will be able to continue making money in this fashion.

New Age Requirements for Credit Cards

Easy credit financing may become a thing of the past. Credit cards are now not available to anyone under the age of 21 without a co-signer; seems quite ridiculous for those honorable men and women serving in the military at age 18. Consumers will have to become very cautious of credit offers and deals. New cards will have much stricter guidelines and fees attached to them then established accounts.

Credit scores will also be affected by these consumer protection laws in a good way. Bad debts are often over-reported on credit reports. Debt holders and bill collectors can now only report a debt for 7 years from the original date it went bad. This is very important, many bill collectors will report a debt as new, even if it is 8 or more years old, because they have recently acquired the debt. Credit scores have been ruined from decade old bills. This can no longer happen.

If consumers learn about all the new rights and protections given to them under these new credit laws they will benefit greatly. Having proper control of your credit and finances is always the first step to financial success.

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