My Fast Cash Instant Approval
Credit Cards
Travel Reward
Credit Cards
Debit Cards
Bad Credit
Credit Card
Credit Card
Credit Cards

July 09, 2010

  • News:  Pew Report; CARD Act For Whose Benefit?

    During the debates over the Credit Card Accountability, Responsibility and Disclosure Act (CARD Act 2009), there was a lot of controversy over who would ultimately benefit from the new legislation; the cardholder or the credit card companies. The most recent report by the Pew Charitable Trust Safe Credit Cards Project indicates that card issuers are not very willing to disclose expected late fee increases and rate increases for cash advance fees. As required by the new CARD Act, lenders indicated that interest rates resulting from late payments will not applied until payments are 60 days past due. The rate for penalty interest rates ranged anywhere from double to triple the current rate.

    According to the Pew report, nearly 95 percent of all credit cards are expected to have some kind of interest rate increase due to late payments and another 40 plus percent of the credit unions. The report also indicated that since December of 2008, credit card interest rates have increased by more than 30 percent. Credit unions had the lowest interest rates at approximately 16 percent whereas the average U.S. lender interest rate was 21 percent. The report showed that late fees ranged from $20 to $39 with credit unions at the bottom of the spectrum. Cash advance fees have also increased. On an average, banks rose to 24 percent while credit unions rose to 16 percent.

    Pew discovered that credit card companies have made good on their threats to implement new annual or over-the-limit fees on cardholders. The number of cards carrying annual fees actually decreased to 14 percent since July 2009. However, for those companies that are charging an annual fee, the amount increased from an average of $50 to $59 for banks and $15 to $25 for credit unions from a year ago. Over-the-limit fees have practically gone away whereby 80 percent imposed one last year which has dropped significantly to 25 percent.

    Back to News Main Page