The Credit Card Accountability Responsibility and Disclosure Act made many changes to the way in which credit card issuers operate. However, there are other items included within the new credit card legislation that deserve some attention as well. Among them are:
Estate Resolution
When a credit cardholder passes away and the estate administrator must settle the unpaid debt, the company is required to settle with the administrator in a timely manner.
Financial Literacy and Language Barriers
The federal government will study the availability of federal financial & economic literacy programs for children in kindergarten through 12th grade – especially in low to moderate income communities. The availability of these programs for post-secondary students as well as adults will also be studied. They will look at the feasibility of using credit card fees as a source of funding for the expansion of these programs.
- the relationship between fluency in the English language and financial literacy; and
- the extent, if any, to which individuals whose native language is a language other than English are impeded in their conduct of their financial affairs.”
So, basically the government will conduct research to see if consumers who’s first language is English are receiving enough Personal Finance education; then they will look to see if someone who’s first language is not English is at a disadvantage when it comes to understanding various financial terms and concepts.
Credit Protection Programs
Many creditors offer insurance that promises to pay the minimum payment if the consumer is unable to make the payment (for instance if they become unemployed). The premium is usually a percentage of the outstanding balance and is added to the balance each month. The companies are very aggressive in marketing these plans – including inserts in each monthly statement, links on their website and even direct phone calls!
The government will study to determine if these plans are suitable to offer to certain customers, and also if the structure of these plans is predatory in nature.
Penalties for the Credit Card Companies
The minimum penalty for violation of any of the provisions in the Credit CARD Act is $500 per incidence with a maximum fine of $5,000 per incidence. This may not seem like much for these large corporations, but we must consider how quickly one violation can spread to the millions of credit card holders.
Right to Bear Arms?
This is one of the oddest provisions in the Credit Card Accountability Responsibility and Disclosure Act. No, it is not giving us the right to carry a gun into negotiations with our creditors!
It states that a visitor to a National Park or Wildlife Refuge is allowed to bring a registered firearm into the park! This is because, according to Congress, “The Second Amendment to the Constitution provides that ‘‘the right of the people to keep and bear Arms, shall not be infringed”.
So, while these provisions don’t make up the “meat” of the Credit CARD Act, it is still important to keep them in mind.
Anyone have a hard time administering the estate of a loved one who passed away with credit card debt? Ever signed up for a credit protection plan and actually received a benefit from it? Do you plan on bringing your gun into a Wildlife Refuge?
I would love to hear from you. Please leave your comments and questions below.
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