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House Looks to Speed Up New Credit Card Rules

November 4, 2009 - by Donny Shaw

Congress messed up a bit when they approved their credit card reform bill back in May by giving credit card companies too much time before the bill’s new consumer protections take effect. They thought it was only fair to give the companies some time to adjust and prepare for the new regulations, so they gave them 9 months. But instead of playing fairly, the companies have been taking this time to jack up interest rates as much as they can before the new regulations take effect, banning arbitrary rate hikes.

Today, the House of Representatives is scheduled to vote on taking away the 9-month grace period. The Expedited CARD Reform for Consumers Act of 2009 they are voting on today would move implementation of the reforms up to December 1, 2009 (soon!). Congress Matters has posted the full list of the provisions that would be bumped up by the bill. You can see all the amendments to the bill that will be voted on by the House at the Rules Committee website.

It’s expected to pass, mostly with Democratic support, but it will also have to go through the Senate before it can become law. The Senate is generally a bit more bank-friendly than the more populist House, so passage there could be more difficult. Sen. Mark Udall [D, CO] introduced a version of the bill in the Senate on October 21st. So far, it has attracted 11 co-sponsors; all of them Democrats.

UPDATE: The bill has been approved, 391-92. The only Democrat who voted against the bill was Rep. Stephanie Herseth Sandlin [D, SD-0], who also voted against the original credit card bill. Federal law allows banks to ignore states’ individual usury laws and follow only the law of the state they are officially chartered in, and South Dakota has the most lax usury law in the country. Not surprisingly, a lot of the big credit card companies are chartered there.

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Comments

  • tyg 11/04/2009 2:04pm

    Well all of my credit cards increased my rates, even though I pay on time and never missed any payments. Every single one is now above 24%, with one at 30%! And all of my “opt out” deadlines are in November, before December 1st. So unless they force them to reinstate the original interest rates, this bill won’t do anything to help me or anyone else avoid being robbed because they didn’t waste any time implementing astronomical interest rates before the ban took effect. It’s a joke that they gave the credit card companies “time to prepare;” all that did was accelerate the very thing they were supposedly trying to prevent, hurting innocent, already struggling people. Was it really surprising that they jacked up every (poor person’s) rates? No. Where is the logic? The only way to effectively protect the people from corporate greed and abuse is to pass a law that prevents those things immediately. Especially now in this time of high unemployment! The honest hardworking taxpayers lose.

  • adn11 11/04/2009 6:15pm

    Tell me about it. I have been a very careful user of credit card. Always pay my due on time and even pay off the balance ASAP. But of late I notice that of some my credit card companies are playing tricks, especially the cards with high balance, although still less than tenth percent of my total credit. They first send out the letter of “notice of change” and then they start raising the rate for no reason. Good thing that I pay off the balance the minute that they do that. I believe that what they are trying to do is to skimming off the even the most responsible consumers and trapping those with higher balance during the difficult period. There is really no logic in this. They are just trying to raise more profit at the consumers expenses by playing around and take advantage of the loophole with the current existing laws and regulations. Yet, we all consumers are continuing suffer at this moment if proper laws passed to protect us from these unfair practices.

  • Comm_reply
    spender 11/05/2009 4:42am

    adn11: “There is really no logic in this. They are just trying to raise more profit at the consumers expenses by playing around and take advantage of the loophole with the current existing laws and regulations.”

    I believe that is the logic. Do what you can to make as much money as possible as the consumer’s expense. Greed is supposably good, after all.

  • mkail666 11/04/2009 6:52pm
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    + -1

    Oh, I’m sorry, why wasn’t the old date good enough? Was it because the credit card companies don’t like the new rules and they’re trying to up the rates and payments while they still can? Could it have been that we wouldn’t be seeing this kind of underhanded practice if Congress didn’t pull a bull**** list of credit card holder “rights” out of their rear end?

  • BenjaWiz 11/04/2009 10:55pm
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    + -1

    Dudes, Washington lobbyists get their way not the voters lol wake up!.

  • need_to_comment 11/05/2009 4:18am
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    + -1

    Hmmm… Congress passes a “protection” bill and good consumers get punished with higher interest rates. If Congress wouldn’t have passed the bill your rates would have been the same as before (lower). See what happens when big government intervenes too much. Who is really the greedy one here, Congress and the President. Not necessarily greed for money, greed for power.

  • Comm_reply
    spender 11/05/2009 4:36am

    need_to_comment that’s the same logic a mobster uses when trying to justify his terror. “I told you not to call the police. If you hadn’t done that, your store wouldn’t have been burned down.” That doesn’t make the arson the fault of the police. It’s the fault of the guy with the matches.

  • Comm_reply
    spender 11/05/2009 4:37am

    Ah…I guess HTML doesn’t work here.

  • BenjaWiz 11/05/2009 5:49pm
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    + -1

    Big Government, Wasteful Spending, And it’s Not Efficient I see no real change in Washington just more the same.

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