Credit Report Blog
Website CertifiedPrivacy Protected
Credit Report & Credit Score; Credit Repair, Debt Management > Credit Score > Great Credit Card Interest Rate Reforms for Consumers

Great Credit Card Interest Rate Reforms for Consumers

By Ruth Racey
Published: Tuesday, January 19th, 2010

It is a fact that there are a lot of consumers who are being very wary of how credit agencies are servicing and rating consumers who uses credit cards. This is because of the fact that most of the time; these credit bureaus are not acting in the interest of consumers. On the contrary, credit bureaus are seen as agencies who act in the interests of big banks and lenders. There are many facts that prove this point. According to one study, most credit reports are actually laden with errors, wherein such errors are generally known to cause a low credit score for you. To be exact, 79% of the time, your credit report may be laden with inaccuracies and errors.

Of course, having a low credit score would mean financial distress to many consumers. Remember that every time you are going to apply for loans, lenders will first look at how creditworthy you are. And there is no other indicator of your creditworthiness than your credit score. In this case, whenever you have errors in your credit report, and hurt your credit score, there are larger chances that you will have disapproved loans. In addition, it will also cause you to pay for higher interest rates in your debt. Truly, having a low credit score is the last thing that you would like to have.

It is a good thing that the Fed has already acknowledged this situation. Starting July of 2010, expect some credit card interest rate reforms that will be enacted as required by the law, including fairer credit reports and a fairer way of giving your credit score. Here are some of the credit reforms that consumers must expect:

First of the most useful of these reforms are the legislation that requires credit agencies not to raise the interest rate payments of your outstanding balance, except when you are already paying 30 days beyond the dues of your bills. Before, credit agencies can actually change the interest rates even though you have not yet reached 30 days late payment. However, due to this reform, credit consumers can now have a breathing room.

In addition, whenever credit agencies are going to change your interest rate payment, they are required to mail you. Before, credit agencies actually surprise consumers by only notifying them that their interest rates have already been raised when the time comes for them to see their credit reports. This surely does harm to anyone’s credit score.

No Comments

No comments yet.

RSS feed for comments on this post.

Sorry, the comment form is closed at this time.