Credit Reform – Why Its Time to Take Charge
It’s a big week for Smart Cookie card holders. The long awaited US credit reform is finally here. The credit card changes that begin this week create more transparent lending and reporting practices from banks and credit card companies. But as Smart Cookies and responsible consumers, lets mark today as a day to also take a transparent and proactive approach to our own credit card spending. Check out the Smart Cookie breakdown of what credit reform means to you, and how taking charge can save you money. And for our Canadian cookies, changes in U.S credit reform means that you too, have an opportunity to understand the ins and outs of credit more clearly than ever before.
1. Late fees “ creditors must provide at least 21 days from the date the bill is mailed, for you to pay your bill. Additionally, bills cannot be due on weekends or have adjusting due dates (the 17th one month and the 18th the next).
2. Over-the-limit fees “ before you can make a purchase that exceeds your credit limit, you will have to opt-in and authorize receiving an over-limit fee. If you do not, the purchase will not go through.
3. Plain language and Clear Information ( We Love This)
Contract terms must be in written in clear language and be disclosed in such a way that you can understand them and effectively manage your finances.
Information regarding how long it will take and how much it will cost the consumer to pay off their account, if they only pay the minimum due each month, must be shown on monthly statements.
The creditor must also show the payment and interest cost if the consumer were to pay the debt off in 36 months.
This week American Express has done a great job of providing card holders with a very Smart Cookie approved breakdown about changes in card practices as a result of regulation and is offering highlights, tips and tools to help you better use your card and navigate current economy. Check it out here
