July 30, 2010
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More Fair Play for Credit-Card Consumers, Pt.4
Late Payment beartrap and more.Sneaky Late Fees: No longer can credit card lenders play around with when you receive your monthly statements. Now they must deliver your credit card bills at least 21 days before they're due. Before, case after case was being reported and proven where honest and responsible card holders were receiving their bills after they were already over-due. Of course, the result was usually heavy fines and other lasting punitive measures. Most large issuers would try to remedy this problems but, there were a few "rotten apples" that would actually create conditions to cause this so they could steal from their customers.
Further, your payment due-date must be fixed to the same day each month and not wobble around to catch you off-guard by moving it up a day or two from time to time.
One more point on this…starting August 22, even if a credit card holder should be late on a payment, the lender can't get away with the "no holds barred" and sock it to them. Reasonable limits have been established as to what's fair and reasonable. So, within a few weeks, the rule will be that the penalty fee may not exceed the amount of the payment due. (Side note: Some lenders are juggling this rule by raising the amount of minimum payment due. This can actually be a good thing because credit card consumers will gain further from reducing their principle more quickly). Beyond that, in any case, the fine must not exceed $25 - $35 for a late payment fee.
Transfer Fees: Balance Transfers and Cash Advances (BT/CAs) are still pretty much left untouched. A new trend has surfaced here, however. Research has exposed significant hikes in transfer rates. Ethical issues are now being studied. As mentioned previously, bulk mailings abound offering low APRs and free Cash Advances (CAs) that lure credit card consumers to take advantage of the low interest offers. One ethical conundrum is the shady disclosure that doesn't state the transfer rate. Instead, fine print simply states something like "Transfer fees applicable to credit card holder's agreement".