New credit card rules go into effect

WASHINGTON- New rules go into effect Thursday bringing changes to purveyors of plastic. But how will those rules benefit or possibly hurt you?

Many Americans say these new rules are long overdue. Though the full scope of the new law doesn't kick in until February 2010, the first phase taking effect Thursday will definitely make a change.

Let's face it, in this day and age almost every American uses a credit card. And just about every user has a least one pet peeve about them.

Now, credit card holders get to fight back. Thanks to the Credit CARD Act enacted by Congress three months ago. Experts say these new rules will restrict the credit card industry's ability to raise rates and charge fees based on each borrower's risk.

But with the good always comes the bad. What some media outlets aren't telling you is that in turn, this will make lending money more expensive, forcing the bank to withhold credit, charge new customers higher rates and increase annual fees.

And those of you participating in rewards programs, you'll suddenly find them a little less rewarding.

To make up for losses, the bank expect to have lucrative rewards, such as frequent-flier miles and cash rebates, will become few and far inbetween. Now many of us will have to pay more or earn more points to redeem those little perks.

So in the coming weeks, consumer advocates recommend using the rewards you have soon because they could lose their value. And be sure to read over your terms and conditions because notices of such changes are often time not clearly labeled.

For a full list of all the new rules go to:
http://www.opencongress.org/bill/111-s392/show