One step closer to a credit card bill of rights

Feel like you are getting taken by your credit card company?

You're not the only one.

Thanks to Congresswoman Carolyn Maloney, Democrat of New York, the House voted for the Credit Cardholders’ Bill of Rights on Tuesday, by a 312-112 margin.

The Maloney bill still has to pass the Senate, and President Bush would have to agree to sign it. The bill sends a message to many including the Federal Reserve, which is considering tough new rules for credit card issuers by the end of the year.

According to the New York Times. the Fed itself has described the credit card companies’ bag of tricks as “deceptive”and “anti-competitive.” When the agency proposed its own news rules some time ago, about 56,000 people answered the call for comments, most of them expressing anger at the way they had been mistreated by their card companies.

House Financial Institutions and Consumer Credit Subcommittee Chairwoman Carolyn B. Maloney (D-NY) today introduced the “Credit Cardholders’ Bill of Rights Act of 2008” (H.R. 5244), comprehensive credit card reform legislation aimed at leveling the playing field between credit card companies and consumers. The balanced bill abolishes major industry abuses that unfairly hurt consumers while fostering fair competition and free market values.

Congresswoman Carolyn Maloney, describes the bill like this;

“A credit card agreement is supposed to be a contract, but in recent years cardholders have lost the ability to say no to unfair interest rate hikes and fees. This balanced, moderate bill simply levels the playing field between card companies and cardholders while fostering fair competition and free market values. It sets no rate caps, fees, or price controls, nor does it dictate any business models to card companies,” said Rep. Maloney.

“There is no doubt that credit card companies provide a valuable service and deserve to earn a fair profit, but consumers deserve the right to be able to understand their accounts and be empowered to control them. Regrettably, regulators and prior Congresses have dropped the ball on protecting consumers in recent years. My bill would give cardholders the information and rights they deserve to make decisions about their own credit,” Maloney continued.

The Credit Cardholders’ Bill of Rights:

-Protects cardholders against arbitrary interest rate increases
-Prevents cardholders who pay on time from being unfairly penalized
-Protects cardholders from due date gimmicks
-Shields cardholders from misleading terms
-Empowers cardholders to set limits on their credit
-Requires card companies to fairly credit and allocate payments
-Prohibits card companies from imposing excessive fees on cardholders
-Prevents card companies from giving subprime credit cards to people who can’t afford them
-Requires Congress to provide better oversight of the credit card industry
-Contains NO rate caps, fee setting, or price controls

To read the bill, click here