John Ulzheimer outlines some of the major provisions in the fine print of the new credit card legislation winding its way through Washington:
Big Print: “Prevents Unfair Increases in Interest Rates and Changes in Terms”
Fine Print: Too vague. It calls for the credit card issuer to interpret terms such as ‘arbitrary and periodic.’ On the surface, this means consumers should be able to earn back their lower interest rates within six months of an on-time payment. The fine print suggests that the issuer can determine whether or not you deserve your lower rate back.
Big Print: “Ensure Adequate Safeguards for Young People”
Fine Print: If you are the parent of a minor under 21, you will likely be asked to co-sign for a credit card if your child wants to apply. This is dangerous for parents as it makes them fully liable for payment – or non-payment.
Big Print:“Gift Card Protections”
Fine Print: Gift cards now must have a five-year lifespan and cannot diminish in value over time. It sounds great, but it also makes it a lot easier to forget about a gift card entirely if you don’t feel an urgency to use it.