LoBiondo: Credit Bill Will ‘Level the Playing Field’

WASHINGTON — In a world where signing for a credit card purchase parallels signing off one’s soul, the House of Representatives passed a bill April 30 that could protect credit card holders by taming some of credit card companies’ powers.
Legislation called The Credit Card Holders’ Bill of Rights, passed by a vote of 357-70, intends to prohibit credit card companies from raising interest rates and fees without warning the consumer.
Congressman Frank LoBiondo (R-2nd) told the Herald the bill formalizes some long-term discussions to formulate rules to protect consumers.
“This bill contains positive pro-consumer provisions that will help level the playing the field, which has over the years been skewed against consumers. Individual responsibility is clearly at the top of the list. Credit card holders need to be responsible for their actions and the money they spend,” LoBiondo said.
“It will help to simplify and decode some of the credit card policies that have been in fine print and hard-to-understand legalese form for years,” he said.
The bill ends universal default, which means consumers who are late on a payment will not see the interest rates on other cards automatically increase and prohibits creditors from issuing credit cards to minors.
“This is a really big deal because some college students receive applications for credit cards without their parents knowledge and in some cases it has encouraged reckless spending,” LoBiondo said.
He said the bill directs a consumer’s payment to the highest interest rate first, rather than the lowest, so it would allow consumers to better manage their money and payoff debt.
Under the bill, a 45-day period is required before credit card companies can change interest rates.
The bill passed with broad bipartisan support. LoBiondo said he believes the senate will support the bill and President Barak Obama will likely sign the bill into law.
To view the entire bill, visit: http://thomas.loc.gov/ and enter bill number HR 627.
Contact Truluck at (609) 886-8600 ext. 24 or at: ltruluck@cmcherald.com.