December 19, 2008

New credit card regulations could mean good news for those of you with credit cards (which I'm assuming is most, if not all, of you).

This newest credit card crackdown should help you work on your part of almost a trillion dollars in credit card debt. That sounds like a number out of an Austin Powers movie, but it's no joke. The Feds certainly aren't laughing, so they approved new rules with you in mind.

Starting in 2010, companies can't raise your interest rates on a pre-existing balance unless your payment is more than 30 days late. They also can't arrange your payments in a way that gives them the most fees. Double-cycle billing will be a thing of the past. That means those of you who carry a balance will no longer get hit with retroactive interest from your previous month's bill.

Here's something else that will help you: you will now be given a reasonable amount of time to make payments, and those payments will go to balances with the highest interest rate, making sure more of your money actually goes to your debt.

Credit card statements will clearly list the time of day that your payment is due, and any changes to accounts will be in bold or listed separately. Lastly, you can expect no more universal defaults. You won't see a higher rate on one card, just because you miss a payment on another card.

So much of this law is meant to protect you, but it might end up hurting some people as well. These new rules might make it harder for people with bad credit to get, or keep, credit cards.