The CARD Act (Credit Card Accountability Responsibility And Disclosure Act) is a proposed new set of rules that would apply to credit card issuers. This act seems to trump the Credit Card Bill of Rights, which doesn't take effect until July 2010. No, that wasn't a typo. It really doesn't go into effect until the middle of next year for some strange reason.
The provisions of the CARD Act are heavily redundant with those in the Credit Card Bill of Rights. No more double-cycle billing, no more excessive fees, no more universal default and an extended grace period grace the pages of both bills. The CARD Act, however, includes two provisions that move it to the top of the hill in my opinion. They are:
1. No more early morning deadlines for credit card payments. That's right, some credit card issuers will consider your payment late if they receive the payment after a specific time of the morning. This is as if you have any control over their mail room schedule.
2. It would require that the credit card guys offer a fixed credit limit. This seems to give consumers a bit of stability especially when it comes to credit limits. This allows consumers to control their usage based on the understanding of what their utilization percentage will always be.
There's one proposed rule that concerns me though. It's the rule that would limit solicitations to consumers who are under 21 and require a parent's signature. So let me get this straight. I can get drafted, drive a car, sign any other contract, be tried as an adult and stay out way past midnight but I can't apply for a credit card without mommy co-signing? That makes no sense at all. I'd never co-sign for anyone, including my child, because of the shared liability. And, what happens if the padres aren't interested in hooking junior up with a card? Now I'll have to wait till I'm 21 to start building my credit report. That puts me years behind the curve.
Exactly what happens between the ages of 18 and 21 that makes politicians think we're more fiscally responsible? I guess being able to order a frothy pint without the use of my handy dandy fake ID qualifies me to apply for a credit card on my own. Not a big fan of this one but everything else is good stuff.
John Ulzheimer is the President of Consumer Education for Credit.com, founder of CreditExpertWitness.com and is fully qualified to apply for credit cards without his dad co-signing.