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What Does The Credit Card Accountability Act of 2009 Change?

By M. Stan Herring

The Arizona Bankruptcy Lawyer Blog has posted an article about the Credit Card Accountability Act that President Obama signed back in May 2009. The Act changes several credit card stipulations, and might even save people with serious credit card debt from bankruptcy, as suggested by Michael S. Anderson, writer of the article.

Here are a few of the changes:

- Credit card companies cannot charge a penalty fee that is more than the amount associated with the violation.

- Penalty fees are required to be "reasonable and proportional to the omission or violation".

- Late fees or fees for other violations can't be more than $25, unless it's a repeated violation or it costs the credit card company more than $25 to handle the problem.

- Credit card companies are barred from charging inactivity fees on gift cards and gift cards must be valid for 5 years.

- "Credit card companies must show the consequences of negative actions, including the release of periodic statements concerning the time it would take to pay off the balance and the total cost."

- Contracts and terms of conditions must be written "clear in language."

- Terms and conditions can't change for the first year.

- Promotions must be clearly and plainly disclosed.

- "Consumers must not approve transactions that would place balances over limit instead of incurring an over limit penalty."

- Fees would be restricted on bad or low limit credit cards.

These changes could certainly benefit consumers struggling with credit card debt and considering bankruptcy.

If you have had credit card or bankruptcy issues and have questions or concerns, feel free to contact us through our website or by calling 205-879-2447.

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Full post as published by Alabama Consumer Blog on January 03, 2011 (boomark / email).