Lawmakers seek to push credit reform
Woman holding credit card.
TEXT OF STORY
Steve Chiotakis: Back here at home, when Congress passed credit-card reform earlier this year,
banks said they needed time to prepare for the changes. But some in Congress think they should have started to follow the rules sooner rather than later. Here's Marketplace's Tamara Keith.
Tamara Keith: Under the new rules, when banks raise credit-card interest rates, the higher rates can only be applied to new purchases. So many banks are raising rates now on existing balances while they still can, says Josh Frank at the Center For Responsible Lending.
JOSH FRANK: They've used that time mostly to do things like change people's prices and get those changes in before the law takes effect.
That's why Congressman Barney Frank is pushing legislation that moves the reform deadline from mid-February to December 1st.
Barney Frank: They made a mistake in first telling us they needed more time to work out the details and then using that time to take advantage of the gap.
Banks argue some details of the rules still haven't been finalized by regulators. And other reforms have already gone into effect says Nessa Feddis at the American Bankers Association.
Nessa Feddis: Consumers are in control. If they don't like the new interest rate, they can keep the old one, pay off the balance over time and find another issuer.
Sooner are later, stronger protections are on the way.
In Washington, I'm Tamara Keith for Marketplace