The Credit Card Accountability Responsibility and Disclosure Act (CARD Act) was made a law by the United States Congress in 2009. At the time, it aimed to reduce creditors’ abusive or deceptive practices. The Consumer Financial Protection Bureau (CFPB) enforces this law.
First, there’s consumer protection. Creditors are required to take into account a prospective debtor’s ability to pay when deciding whether to extend credit to them. This legislation also protects consumers from being subjected to increases in interest rates and fees.
Another goal of this legislation was to enhance customer disclosures. This law made it where creditors had to be more forthcoming about mandatory minimum payments, payoff time frames, renewals and penalties.
This legislation also forwarded the idea of protecting young consumers. This law was written to prohibit individuals under the age of 21 from being extended credit except in certain situations. This law made it where individuals less than that age needed someone older than 21 to serve as their co-signer to take out credit.
Title IV of the CARD Act also enacted changes regarding gift card electronic funds transfers. Title V empowered the Comptroller General’s office to dedicate more of their efforts to study how consumers and merchants both credit and feel about fees.
The CARD Act protects consumers on many levels. It requires creditors to offer six-month promotional rates on their cards. It only allows them to increase interest rates if you’re more than 60 days delinquent on a balance. It also makes it where creditors have to send statements at least 21 days before any bill is due.
This law also allowed consumers to choose whether to opt-in for over-limit protection on their accounts, changed how creditors were required to apply payments to outstanding balances and affected what penalties debtors can be assessed for defaults. It also made it illegal for creditors to use small font for their terms and conditions.
Many individuals here in Washington are struggling with debt because their creditors preyed upon their vulnerabilities in convincing them to get a credit card. These individuals now don’t know where to turn for help.
An attorney here in King County can advise you of your rights in your case. This may include taking action against your creditor if they violated the CARD Act of 2009.