What is the Credit Card Act of 2009?


You may have heard that the new Credit Card Act of 2009 has been passed by the government to help regulate credit cards more closely. But what is it exactly and what does it mean to you? Hopefully, this brief article will help shed some light on this topic and answer your questions.

The CARD Act was passed on Monday, February 22nd. Simply put, this act is supposed to protect the consumer. Some of the ways it protects the card holder is by requiring banks to provide important information in a timely manner:

  • 45 days notice must be provided to the card holder for significant changes to the terms of their cards
  • The bill must be provided to the card holder at least 21 days before payment is due.
  • The bill will provide additional information, such as how long it will take to pay off your balance if you continue to only pay the minimum balance due
  • The bill will also provide information on how much you need to pay per month in order to pay off the bill in three (3) years

Interest rates are protected for the first year

  • Your credit card company now cannot increase your interest rate for the first year after you open an account
  • After the first 12 months, rate increases can apply only to new charges.
  • You won’t get an increase for late payments that are within 60 days of the due date or for late payments to other creditors.
  • Balances with multiple interest rates, any payment above the minimum payment required must generally be applied to the balance with the highest interest rate.
  • Read More about interest rate terms here

Students are less preyed upon:

  • People under the age of 21 will either need a co-signer or evidence that they have enough income to make monthly payments.
  • Card companies can no longer market cards on college campuses.
  • Read more here about how Students are affected
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