Key Provisions in the New Credit-Card Law

A look at legislation with sweeping new rules for the credit card industry that President Obama will sign on Friday, as well as pending Federal Reserve regulations.

The Credit Card Holders' Bill of Rights Act: Takes effect nine months after enactment, except for requirement of notice before interest rates are increased, which goes into effect in 90 days.

— Prohibits retroactive rate increases unless the cardholder is at least 60 days behind in paying the bill. If a person does fall behind and the rate on past buys is increased, lenders must restore the lower rate after six months if the cardholder has paid monthly bills on time.

— Requires lenders to post their credit card agreements on the Internet.

— Requires that customers receive 45 days notice before rates are increased.

— Requires anyone under 21 to prove that they can repay the money before being given a card, or have a parent or guardian promise to pay off their debt if they default.

— Prohibits over-the-limit fees unless a cardholder elects to be allowed to go over a limit.

— Requires lenders to say how much time it would take and how much money in interest would be paid if only the minimum monthly payments are made.

— Requires that gift cards remain valid for five years.

— Bans "pay-to-pay" fees, which are charged when someone pays the bill by phone or on the Internet.

— Includes unrelated provision that would allow people to carry loaded guns in national parks and wildlife refuges.

Federal Reserve Regulations: Take effect in July 2010.

— Require banks to give customers a reasonable time, such as 21 days, to pay the bill before it is considered late.

— Require banks to give customers 45 days notice before raising interest rates on new purchases, even if the customer is late or delinquent in paying the account.

— Prohibit, in most cases, retroactive rate increases. Does not include a provision that would require lenders to reduce the rate after six months if the person pays on time.

— Prohibit double-cycle billing.

— Limit excessive fees charged on subprime credit cards, which are marketed to people with bad credit.

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