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President signs the Credit Card Accountability Responsibility and Disclosure Act
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This is a consumer alert that has a huge impact on you as a credit cardholder. The Act amends existing law and requires credit card companies to notify cardholders in writing at least 45 days prior to any change in the annual percentage rate (APR). It also gives the cardholder the right to cancel the account before the effective date of the rate increase.
Card companies can increase the APR if 1) the index on which the rate is based changes, 2) it is a promotional rate that has expired, 3) a cardholder fails to comply with a hardship workout plan or 4) the account fall 60 days past due.
There are lots of other provisions and a three page summary is provided by the US Senate here...
The Credit Card Accountability Responsibility and Disclosure Act of 2009
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Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management in Towson, MD. He is a member of NAPFA and the MACPA.
