Protects Families from Unfair Credit Card Practices

Press Release

Congresswoman Rosa L. DeLauro (CT-3) joined with colleagues to pass the Credit Cardholders Bill of Rights (H.R. 5244), which provides critical protections against unfair, but common, credit card practices. Credit card debt in the United States has reached a record high - nearly $1 trillion - and the average American household credit card debt has increased from $2,966 in 1990 to $9,840 in 2007, while credit card company profits have skyrocketed.

"For too long credit card companies have engaged in unfair credit practices. Today we send a strong signal that these practices are unacceptable and that the interests of the families on Main Street come before the interests of the credit card industry," said DeLauro. "The minimal oversight and few regulations of credit card companies have contributed to the debt crisis faced by many Americans. With this legislation, we will begin to curb the excessive credit card fees, sky-high interest rates, and unfair, incomprehensible agreements that credit card companies revise at will - and in extremely small print."

To protect families from unfair credit card practices, the Credit Cardholders Bill of Rights (H.R. 5244) would:

End Unfair, Arbitrary Interest Rate Increases.

Prevent card companies from unfairly increasing interest rates on existing card balances

Require card companies to give 45 days notice of all interest rate increases so consumers can pay off their balances and shop for a better deal.

End unfair penalties for cardholders who pay on time, like charging interest on already repaid debt.

End the credit card practice of applying consumer payments to lower interest debt first.

Protect Cardholders from Due Date Gimmicks by requiring card companies to mail billing statements 25 calendar days before the due date (up from the current 14 days).

Establish standard definitions of terms like "fixed rate" and "prime rate" so companies can't mislead or deceive consumers in marketing and advertising.

Give consumers who are pre-approved for a card the right to reject that card prior to activation without negatively affecting their credit scores.

Bar issuing credit cards to individuals under 18.

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