The House of Representatives passed a bill to move up the effective date for the new credit card law to Dec. 1, 2009. The original effective date was August 2010, which then moved to February, before this new bill was passed because lawmakers sensed that credit card companies were conducting unfair practices since they knew they would soon be restricted by the law.
Unfair Credit Card Practices
There have been reports from cardholders around the country for many months that their credit card issuers have been participating in unfair practices. Some of these practices include double-cycle billing, unexplained interest hikes, drastically lowered limits, and even card cancellations with no explanation. In addition, credit card companies had left bad tastes in many mouths because of their insistence upon coaxing financially-inexperienced college students into signing up for cards in exchange for freebies, resulting in many teens and young adults having damaged credit.
The Affects of Moving the Effective Date
Lawmakers hope that by moving the effective date of the new law, cardholders will be able to breathe a much-needed sigh of relief. On the other side of the coin, the new effective date will require that credit card companies enforce new strategies for managing cardholder accounts almost immediately, including allowing cardholders the ability to reject changes to their contracts (see more about the Credit Card Bill of Rights).
Currently, the bill is still moving through Congress. It must be passed by Senate before it can reach President Obama to be signed into law.
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