Congress Sends Yarmuth-Sponsored "Credit Cardholders' Bill Of Rights" To President's Desk

Press Release

This afternoon, the U.S. House of Representatives approved final legislation that will halt the abusive activities of credit card companies that contributed to the extensive debt facing millions of Americans. The Credit Cardholders' Bill of Rights, of which Congressman John Yarmuth (KY-3) is an original cosponsor, will end the unfair penalties and retroactive interest rate hikes that existing, outdated regulations allowed.

"The Credit Cardholders' Bill of Rights will protect hard working people and families who played by the rules and paid their bills on time, but were still treated unfairly by credit card companies," Congressman Yarmuth said. "Our economic recovery depends on ensuring that the American people no longer have to worry about being taken advantage of by their financial institutions. This new legislation safeguards consumers and guarantees their protection from unfair tactics."

Included among the provisions in the legislation is a ban on most interest rate increases on existing balances and a requirement that 45-days advance notice is given on future interest rate hikes. The legislation also requires bills be sent at least 21 days before the due date and prohibits fees for bill payments made by phone, over the internet, or via mail. Many of the practices banned were among those deemed "deceptive" and "unfair" by the Federal Reserve.

The Senate passed the bill yesterday, and President Obama is expected to sign the legislation into law in the coming days.

Specifically, the Credit Cardholders' Bill of Rights will:

Protect cardholders against arbitrary interest rate hikes
Ban unfair penalties on cardholders who pay on-time
Prevent companies from using misleading terms and damaging consumers' credit ratings
Require card companies to fairly credit and allocate payments
Prohibit card companies from imposing excessive fees on cardholders
Protect vulnerable consumers from high-fee subprime credit cards
Bar issuing credit cards to vulnerable minors

Source