Credit Card Companies, The CARD Act, And Bankruptcy

Bankruptcy Attorney Dayton, Oh

When the CARD Act was passed it was regarded as very important legislation for consumers. The CARD Act placed limits on the interest rates and the fees that credit card companies can charge and the consumer disclosure required, but have these companies changed the way business is done because of this act? The CARD Act was implemented in stages, with the final stage started in August of 2010, and the credit card companies have already devised ways to get around the new restrictions and regulations so that high interest rates and excessive fees are still a problem today.

The CARD Act sets many new rules and restrictions for credit card companies, including:

  •     Inactivity fees are no longer allowed
  •     Late fees may not be in an amount considered excessive
  •     Only a single penalty fee may be applied by the card company at any given time
  •     Consumers have a 21 day grace period for all purchases before interest can start to accrue
  •     Fees for exceeding the credit limit of the card can not be automated
  •     Consumers must receive at least 45 days notice before card issuers can change any major terms of the credit card
  •     Raising the interest rate of the card is not allowed until a payment is past due by at least 60 days

The credit card companies have already found methods that do not violate the CARD Act but increase the fees and interest rates charged. These companies are very creative on this front, and while the following methods do follow the regulations outlined in the CARD Act technically they are still devious and greedy. As long as the required notice of 45 days is given your credit card company basically has license to raise your rates and change the rate type at will. The issuer of the credit card may:


  •     Convert your card from a fixed interest rate card to a variable interest
  •     Raise your card rate to an enormous 29.99%
  •     Make other changes regarding your interest rate


All of these moves are legal as long as the credit card company gives you notice at least 45 days before these changes take effect. Many card issuers have already started sending out mass mailings alerting consumers that their card terms and rates are changing. This leaves many consumers in a bind, looking for answers and debt relief. Credit card debt can be handled using either bankruptcy or debt consolidation and the first step should be consulting with an experienced attorney in these areas. If you could not pay the payments when the card interest was lower it will not be possible to make the payments once the card issuer jumps up the rate. Get sound legal advice as soon as possible to ensure that debt collection practices do not add to your financial problems.


The bankruptcy attorneys at Richard West Law can help provide a free debt consultation to help you find the right answer for your unique debt problems, credit card issues, and circumstances. Visit or call (513)771-8700 or (937)748-1749 to get the answers you want, and the financial relief you are looking for.

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