{"id":8419,"date":"2009-09-24T20:00:33","date_gmt":"2009-09-25T00:00:33","guid":{"rendered":"\/\/www.askmrcreditcard.com\/news\/?p=8419"},"modified":"2009-09-24T20:00:33","modified_gmt":"2009-09-25T00:00:33","slug":"a-lot-of-action-in-advance-of-card","status":"publish","type":"post","link":"https:\/\/www.askmrcreditcard.com\/news\/a-lot-of-action-in-advance-of-card\/","title":{"rendered":"A Lot Of Action In Advance Of CARD"},"content":{"rendered":"

Anyone who has a credit card knows by now that card issuers are clamoring to enact new rules before the CARD act becomes effective in February.<\/p>\n

Congress Wants To Head Them Off At The Pass<\/strong><\/p>\n

Now comes word that some of the original proponents of the CARD act want to amend it to take effect even sooner.\u00a0\u00a0 The Wall Street Journal reports<\/a>, that Representatives Barney Frank and Carolyn Maloney will propose a bill that would move up the implementation date by two months to December 1st from February 1st.<\/p>\n

Personally, I wish it would go into effect immediately, but realistically two months won’t make much of a difference.\u00a0\u00a0\u00a0 Part of the rationale is that people doing their Christmas shopping should be able to be guaranteed what interest rate they will have to pay for their purchases.\u00a0\u00a0\u00a0\u00a0 Either way, credit card companies have plenty of time to raise rates and fees in advance of the legislation.<\/p>\n

I suspect a lot of these rate and fee increases are precautionary.\u00a0\u00a0\u00a0 The market is still highly competitive, and I would expect plenty of promotional rate and fee reductions in the next year as companies struggle to attract new customers and win back old ones.<\/p>\n

What You Can Do<\/strong><\/p>\n

The folks over at SmartMoney have put together a list of six traps to avoid. <\/a>Lets take a look:<\/p>\n

1.\u00a0 Higher Interest Rates. \u00a0\u00a0 Everyone is getting these. \u00a0\u00a0 The best thing that you can do is not pay them. \u00a0\u00a0 If you are not one already, now is the time to become a “deadbeat”, someone who uses their credit card as a method of payment not<\/strong> a method of finance.\u00a0\u00a0\u00a0 For the rest of you, keep looking for cards with lower rates, they are out there.<\/p>\n

2. Moving from fixed to variable rates.\u00a0\u00a0 Part of the CARD act says that companies can no longer market rates as “fixed” if they can change them at any time.\u00a0\u00a0\u00a0 In response, card issuers have converted almost all “fixed” cards to variable cards.\u00a0\u00a0\u00a0\u00a0 This is either a huge loophole in the law, or merely eliminating the deceptive marketing practice of calling cards “fixed”.\u00a0\u00a0\u00a0 Since no cards were ever really “fixed”, I tend to go with the later explanation.<\/p>\n

3. Annual Fees:\u00a0\u00a0 Everyone is saying that cards will start having higher annual fees.\u00a0\u00a0\u00a0 That may be true, but to be successful, they are going to have to give card holders something valuable in return.\u00a0\u00a0\u00a0 I recently applied for a Southwest Airlines\/Chase card with an annual fee.\u00a0\u00a0\u00a0 I did have a targeted offer of 16 Rapid Rewards credits, essentially a free flight.\u00a0\u00a0\u00a0 There is an annual fee of $49, but I think that is worth it.<\/p>\n

4. Usage Fees:\u00a0 I really don’t know where the authors are getting this idea.\u00a0\u00a0\u00a0 They are merely speculating that this may happen.\u00a0\u00a0\u00a0 I am having trouble imagining this being very successful for all but the lowest sub-prime sector of the market.<\/p>\n

5. More Junk Mail.\u00a0\u00a0 Like higher interest rates, this really doesn’t bother me much.\u00a0\u00a0\u00a0 I have long ago registered with the Direct Marketing Association and all the major credit agencies to opt out of all solicitations.\u00a0\u00a0\u00a0 That junk mail exists in huge volumes, proves that the market is highly competitive.\u00a0\u00a0\u00a0 It is also very easy to opt out.<\/p>\n

6. Reward Hoops.\u00a0\u00a0 All reward card users and loyalty program gurus know that rewards will inevitably become harder and harder to redeem.\u00a0\u00a0\u00a0 The authors predict that credit card rewards will go the way of airline rewards.\u00a0\u00a0\u00a0 I am not so sure.\u00a0\u00a0\u00a0 As I have pointed out before, airlines best customers are frequent travelers at their hubs, most of whom really can’t switch to other airlines conveniently.\u00a0\u00a0\u00a0 Switching credit cards is the easiest thing in the world.\u00a0\u00a0\u00a0\u00a0 If I am not getting value out of my credit card company’s reward program, I will drop it or switch to a cash back card, it is that simple.<\/p>\n

Conclusions<\/strong><\/p>\n

I still have no doubt that the CARD act is a huge win for consumers.\u00a0 Credit card companies are trying to mitigate the damage in advance of the CARD act becoming effective.\u00a0 Don’t let that scare you.\u00a0\u00a0 Maintain good credit, don’t go into debt, and you will always be able to find a card that meets your needs.<\/p>\n","protected":false},"excerpt":{"rendered":"

Anyone who has a credit card knows by now that card issuers are clamoring to enact new rules before the CARD act becomes effective in February. Congress Wants To Head Them Off At The Pass Now comes word that some of the original proponents of the CARD act want to amend it to take effect […]<\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[38],"tags":[],"yoast_head":"\nA Lot Of Action In Advance Of CARD<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.askmrcreditcard.com\/news\/a-lot-of-action-in-advance-of-card\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A Lot Of Action In Advance Of CARD\" \/>\n<meta property=\"og:description\" content=\"Anyone who has a credit card knows by now that card issuers are clamoring to enact new rules before the CARD act becomes effective in February. 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