New Laws Regulating Credit Card Companies

For many years, credit card companies have engaged in unscrupulous behavior when dealing with consumers. Many of us have experienced unfair increases in our interest rates, or multiple penalty fees in one billing cycle. These abusive practices have paved the way for the federal government to step up its game and enact new laws designed at helping debtors with massive credit card debt. On February 22, 2010, new laws came into effect, and in August 2010, more are set to follow. Some of the major points consumers should be aware of include:

- Companies must send you written notice 45 days before they increase your rate or fees
- There is a cap on all high-fee cards
-For underage credit card users, they will need to show their ability to make payments, or have a co-signer.
- Interest rates cannot be raised during the first 12 months of opening up an account.


Despite the good intentions of the federal government, more needs to be done to alleviate those struggling with credit card debt. For many of these debtors, bankruptcy proves to be the best way to alleviate their high debt. For those individuals that satisfy the means test and qualify under a Chapter 7 filing, the majority, if not all, of unsecured debt is "wiped out" or discharged, including credit cards. As a result, debtors are finally able to take control of their finances, allowing them to begin rebuilding their credit scores immediately.


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