Education & Community

• Planning & Saving
• Credit & Debt
• Forums
• Debtbusters Blog
• Financial Information Blog
• CESI Company Blog
• Community Guidelines

Now that President Barack Obama has signed a federal law to protect millions of consumers who rely on credit cards, we're in a new era of managing credit. Millions of credit card users will avoid retroactive interest rate increases on existing card balances and have more time to pay their monthly bills, greater advance notice of changes in credit card terms and fewer penalty fees, late charges and interest payments.

Limited interest rate hikes: Interest rates on new transactions can increase only after the first year. Significant changes in terms on accounts cannot occur without 45 days' advance notice of the change.

More time to pay monthly bills: Credit Care companies will have to give card account holders "a reasonable amount of time" to make payments on monthly bills. That means payments will be due at least 21 days after they are mailed or delivered. Cutoff times set before 5 p.m. on the payment due dates will be illegal under the new law. Payments due at those times or on weekends, holidays or when the card issuer is closed for business will not be subject to late fees.

Highest interest balances paid first: When you  have accounts that carry different interest rates for different types of purchases (i.e., cash advances, regular purchases, balance transfers or ATM withdrawals), payments in excess of the minimum amount due must go to balances with higher interest rates first.

Limits on over-limit fees: Consumers must "opt in" to over-limit fees. Those who opt out will have their transactions rejected if they exceed their credit limits, thus avoiding over-limit fees. Fees charged for going over the limit must be reasonable