New Law Makes It Harder To Push Easy Credit at Colleges

COURT HOUSE — The state Division of Consumer Affairs has reminded Atlantic Cape Community College (ACCC) President Dr. Peter Mora and all other college administrators in New Jersey, that a new law requires credit card issuers to register before offering credit cards on campus.
“As a new school year is about to commence, I write to express my concern about the burden of credit card debt facing many college students,” Thomas Calcagni, acting Consumer Affairs director. “Excessive marketing of credit cards on college campuses, combined with a lack of practical financial education, have put the financial security of many students and their parent co-signers at great risk.”
“The arrival of the freshman class presents an opportunity to protect those most vulnerable to promotional offers for credit cards,” Calcagni wrote.
While easy credit may be a problem at some colleges, an ACCC spokesperson told the Herald it isn’t a problem on local campuses.
“It is the College’s practice not to allow banks or other credit card issuers to come on campus and solicit students to sign up for credit cards,” said Kathy Corbalis, executive director of ACCC College Relations.
For other campuses, the state’s Credit Card Solicitation Act requires card issuers to provide an on-campus education program, including an explanation of when any introductory interest rates expire, how long it will take to pay off balances making only minimum monthly payments, and definitions of credit terms such as variable rates, grace periods and annual fees.
Under the law, card companies can no longer offer free gifts to students who apply for credit.
Companies that violate these rules face penalties between $5,000 and $10,000 for each offense.
“Easy credit may sound good to cash-strapped students but the downside can be a deep spiral into a whirlpool of debt, with no easy way out,” Calcagni said in a release. “This law will help students better understand what they are agreeing to before they sign on the dotted line.”
Contact Hart at (609) 886-8600 Ext 35 or at: jhart@cmcherald.com