On February 22, 2010 the Credit Card Accountability Responsibility and Disclosure Act of 2009 took effect. The CARD as it is more generally known, is a comprehensive credit card reform legislation that’s meant to establish fair and transparent practices pertaining to the extension of credit under an open end consumer credit plan and for other purposes. Even in the current political climate this bill pass both the House of Representatives and Senate with high bi-partisan support.

This bill outlines several provisions which are for the main benefit of consumers. One of these simple important provisions is that consumers are now protected from arbitrary rate hikes. A card company must give a cardholder advance notice of 45 days before any interest rate increase. A cardholder then gets the option to cancel their card and repay the balance at the previous lower rate. Cardholders have up to 3 billing cycles to take advantage of this choice. It is possible to remove a charge off on credit report.

Various other provisions which are very important to consumers are a prohibition from charging interest on debt that is paid within a grace period. This prevents any double cycle billing. Card companies will in addition be prohibited from assessing fees on any interest-only balances on the cardholder who has paid the bill by the due date, thereby paying the principal for that billing cycle.

Consumers who have been subject to a rate increase owing to late payments or other misconduct who hereafter pay promptly for six consecutive months must have their previous lower rates of interest restored. The creditors must conduct an evaluation of payment history every 6 months to ascertain if a rate decrease should apply.

Cardholders should now be receiving their bills a minimum of 21 calendar days prior to the due date. Prior to the CARD act the requirement was just 14 days. If a payment is made before 5 p.m. EST on the due date it is considered timely. The due dates are now required to fall on the same day each month, with the delay to the next business day if it will happen fall on a weekend or legal banking holiday. If you need to remove repossession just remmeber it can be done.

Just about all terms and conditions from the card should now be incorporated on every statement in a minimum size font that improves readability. There should not any fine print. Also, the information on how to contact your credit card company for information regarding your account will be included on every statement.

Customers also have the choice of getting a fixed credit limit of their choosing that can’t be exceeded and credit card issuers can’t charge over-the-limit fees on a cardholder with a fixed credit limit. Any payment beyond the minimum payment now must be applied to the debt with the highest interest rates first.

And there are definitely more positive provisions for consumers. The CARD act will protect consumers from some of the arbitrary and unfair practices from credit card companies that have happened in the past.

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