Credit Card Company Survey – Banks Respond to Legislation
Posted on | November 10, 2009 | No Comments
By now you most likely have heard about the new credit card rules that are expected to go into effect in February of 2010. On May 22, 2009 president Obama signed the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act placing tight restrictions on the lending practices of credit card companies. The act is designed to mitigate deceptive practices that some creditors have used in the past which has landed millions of Americans in deep credit card debt.
Since the announcement of the act many credit card companies have been taking a proactive approach to the new legislation. The federal government recently surveyed a group of banks asking them about their reaction to the CARD act. The results of the survey are not surprising. Banks are tightening down the buckle and altering their terms and conditions in order to survive. Nearly 50% of banks surveyed indicated that they would be lowering the credit limits and raising interest rates. Around 75% plan or have already raised the rates of those with lower credit scores and slightly less than half will raise their qualifying credit score.
So who will ultimately benefit from the CARD act? The answer to this question may not be known for several months or years after the act goes into effect. I would speculate that banks will continue to fight the new restrictions by continuously changing their practices and ultimately keeping America in debt. Once again, the rich will continue get richer despite any government intervention.
For more news and information on credit cards check out www.healthyfinancialhabits.com. Here you will find an array of information on credit cards and personal finance.
Guest Author: Mike Smitt
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