Many consumers across the country may have noticed that their credit card statements have changed recently.
Thanks to a provision of the Credit Card Accountability, Responsibility and Disclosure Act, credit card companies are now legally required to make their statements more clear so thatconsumers can better understand what they’re being billed for, and how much it’s costing them. According to television station KIVI in Boise, Idaho, there are a number of changes that some consumers may find unfamiliar.
One such change, the station said, is that there is a section that is labeled either "account information" or "account summary." This area shows the most basic information about the account – how much is owed, when the payment is due, and how much of the bill is made up of interest fees. Because this information is the most essential part of a bill, this is what consumers should keep in mind.
The station also says that bills must now include a debt report that shows how long it will take a consumer to pay off their bill if they just make the minimum payment, and another that shows the payment required to pay the debt off in three years, plus the resulting interest savings. This only serves to highlight the importance of paying more than the minimum.
While the Credit CARD Act requires lenders to disclose both initial interest rates and all rate changes, the station advises that all consumers keep an eye on their current interest rate, which must be clearly displayed on the bill. This will help consumers understand just how much they’re paying per month over their current balance.
The Credit CARD Act also requires that lenders make clear the fee for late payments, and keep the same due date every month. The station said both of these requirements will help consumers keep a more regular payment schedule.
However, there is a stipulation in the Credit CARD Act that says consumers must opt in to receive notifications that they have gone over their credit limit, which the station recommends.
A recent report in the Kansas City Star warned that some consumers may be unaware that the Credit CARD Act only changes the laws for personal credit cards, and not business cards. It warns that those tempted to transfer business payments to personal accounts would, in doing so, simply be turning their personal cards into a business card.