If you have a credit card, you’ve probably heard about the Credit CARD Act of 2009. Let’s face it; in one way or another, we’re all trying to make ends meet in this tough economic environment. The Credit CARD Act of 2009 gives card holders a more level playing field, and it offers relief to the millions of Americans who are drowning in credit card debt, while also protecting those who aren’t.

 

• It protects those under the age of 21. Credit card companies will no longer be able to issue credit cards to individuals under the age of 21 unless they can provide proof that they can repay the money they are borrowing on that card or have a parent (or someone else over age 21) co-sign and agree to be responsible for that debt.

 

• It helps those trying to establish or re-establish a credit history. This regulation restricts all interest rate hikes during the first year a card has been issued. Unless you have a card with a variable interest rate, card issuers can no longer raise your interest rate in the first year after a new account is opened. The only exceptions are if the card was opened with a clearly stated promotional rate for at least 6 months or if you go more than 60 days without making your minimum monthly payment.

 

• It helps those trying to get their existing credit card debt in control. This regulation stipulates that the interest rate on your existing debt can’t be raised unless it’s a variable interest rate, the end of a promo period, or you are over 60 days late on your minimum payment (you do not have to be notified for any of these reasons).

 

• It helps those who are trying to dig themselves out of debt. This regulation requires the fair application of payments. Under these new rules your highest interest debt will be paid off first.

 

Unfortunately, credit card practices have been unfairly complicated for a long time, often leading consumers to pay more. Every year, Americans pay around $15 billion in penalty fees. 

 

Our job is to help you keep your credit on track, which is why we will continue to offer the best VISA® credit card around. While other financial institutions are moving to a variable rate card, which subjects credit card holders to interest rate increases as upward changes in financial markets occur, we decided to stay with a fixed rate VISA® credit card product or what must now be called a “non-variable” interest rate product.

 

We pride ourselves on being able to serve you through good credit times and more difficult ones. It’s our job.

 

Thank you for choosing Nutmeg State Federal Credit Union.

 

Sincerely,

 

Loren E. Dickinson

President/CEO