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What Do the Changes to Credit Cards in 2011 Mean?

written by: Kristie Lorette•edited by: Jean Scheid•updated: 4/8/2011

You may be staring at the various changes to credit cards in 2011 and wonder how this affects you. Primarily, the changes benefit you, but you have to know about and understand the new laws in order to use them to your advantage.

  • slide 1 of 6 Changes to credit cards in 2011 have come into play because of some new laws and rules that are required from credit card issuers. In short, these new rules have been put into effect to help protect consumers. For consumers, the new credit card rules were created to benefit them in various ways.

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    Terms & Conditions Changes

    One of the primary changes to credit cards in 2011 is the notification process that card issuers have to abide by to inform cardholders of any changes in the terms and conditions of the card. While credit card companies have always been required to notify cardholders of interest rate changes or other changes to the terms of the card agreement, the new laws tell issuers when they have to notify cardholders. Credit card issuers must notify cardholders in writing, at least 45 days before the change is scheduled to become effective.

    Card issuers must notify cardholders of any changes to the interest rate, annual, cash advance or late fees and any other significant changes to the terms of the card.

    The notification provides you with enough advance notice to make a decision on how you want to proceed with the credit card—by retaining the card or by closing your account.

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    Changes to credit cards in 2011 also require the card issuer to provide more information to the cardholder. On credit card statements, cardholders now see information such as how long it will take them to pay off the current balance if they only make the minimum monthly payment, or what payment amount they need to make to pay off the balance in three years or less. This is to help cardholders understand what their payments mean and provide them information that may help them get out from underneath their credit card debt.

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    Rate Increase Protection

    Another one of the major changes to credit cards protects consumers from interest rate increases. When a cardholder has a credit card, for the first 12 months, credit card issuers cannot increase the interest rate. There are some exceptions to this rule, however. If the cardholder is more than 60 days late on making payments, the card issuer has the right to increase the interest rate. If the card has an introductory interest rate and the rate is due to adjust, then this is another situation when the card issuer has the right to increase the rate even prior to the 12-month period.

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    In general, the changes to credit cards in 2011 are for the benefit of those who use the credit card. Knowing and understanding the new rules helps you to be a better consumer and provides you with the information you need to be an educated credit card holder and user.

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