Finance Space

Depending on the source, Americans carry an average of $5,000-$9,000 on their credit cards.

Linda Pichler with Consumer Credit Counseling Services says, “That’s where most people get into trouble,” adding that the new law will keep credit card companies from burying consumers in penalties, fees and surprise rate hikes. “The new law is definitely going to help the consumer and will regulate rate increases.”

Kevin Jackson with HCCP says the companies will be forced to give 45 days notice if they are going to raise your rates, and he agrees the law will benefit millions of card holders. The new rules also mean simpler, clearer statements.

Jackson says, “One of the things they need to put in there is a chart or graph about what it is going to take to pay off that balance.”

There will be limits on over-limit fees, which experts agree worked to drown consumers in the past. And no more open season on the under-21 crowd.

This should cut down on those offers and the abilities of minors to sign up for a credit. The law is far reaching, but the onus is still on consumers to spend responsibly.

We asked Pichler for the biggest reason people get into credit card debt.

She told us, “Transferring their balance because of lower interest rate, having a zero balance, and then running up that credit card again.”

Experts also advise paying off cards you’re not using but not closing the account, as it may hurt your credit score. And avoid transferring large balances to a lower interest card if there is a hefty fee attached.

Related posts:

• Balance Transfer Credit Cards
• Use caution in closing credit cards
• CONSUMER FINANCE: Credit Card Offer Terms Have Changed
• More credit card reforms to take effect
• Deal of the week: credit cards

Tags: credit card