Thursday, June 4, 2009

New Rules to Restrict Predatory Consumer Credit Practices - Lexington Law� Highlights a Big Win for Consumers When It Comes to Maintaining Healthy Credit

A new set of rules have been signed into law which will restrict some of the more predatory practices of credit card issuers starting mid-2010. Under these rules, credit card issuers will no longer be able to raise interest rates on existing credit card balances without justification. Cardholders will need to be 60 days behind on a payment before issuers can increase rates on exiting balances, and even then, credit card issuers will be required to restore previous rates if a cardholder pays the minimum payment on time for six months.

Salt Lake City, UT (PRWEB) June 4, 2009 -- A new set of rules have been signed into law which will restrict some of the more predatory practices of credit card issuers starting mid-2010. Under these rules, credit card issuers will no longer be able to raise interest rates on existing credit card balances without justification. Cardholders will need to be 60 days behind on a payment before issuers can increase rates on exiting balances, and even then, credit card issuers will be required to restore previous rates if a cardholder pays the minimum payment on time for six months.

These laws also prohibit issuing credit cards to those younger than 21 without proven means to repay the debt or a guardian cosigner, and will require that credit card issuers provide 45 days' notice and an explanation before increasing interest rates on new credit.

Practices which allow creditors to raise interest rates at will and without justification are devastating for the millions of American consumers who's budgets are already stretched trying to meet the demands of modern life in America
As the nation's largest provider of credit repair and correction services, Lexington Law has seen first-hand the severe damage that predatory lending practices can cause in the lives of consumers.

"Practices which allow creditors to raise interest rates at will and without justification are devastating for the millions of American consumers who's budgets are already stretched trying to meet the demands of modern life in America," says John C. Heath, Directing Attorney for Lexington Law.

As a firm that has helped Americans recover from credit-related issues for over 18 years, Lexington Law offers interesting insight when it comes to our nation's "credit crisis." They believe if there's any good to come from our current economic challenges, it's that many flaws making our credit system unfair for consumers are being brought to attention and are beginning to see regulatory action.

"Our firm has represented thousands of clients who have been victimized by an unfair credit system. We know that in order to recover from credit challenges, you first need to get to stable ground. We believe this new rule is a step in the right direction helping consumers regain financial stability, but the credit system still has a long way to go before it can be considered a level playing field for consumers."

About Lexington Law:
Lexington Law is a consumer advocacy law firm, and the leading provider of credit correction services for American consumers. The firm's services are founded upon 18 years of experience representing over 1/2 million clients as they've worked to resolve credit issues. The effectiveness of their services is validated by the success of their participating clients, who see an average of 84% of the damaging information removed from their credit reports within 1 year. (Individual results may vary.) More information about Lexington Law can be found at www.LexingtonLaw.com.

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[Via Legal / Law]

Posted by prolink at 1:45 AM

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