WISCONSINREPORT.COM (05/20/2009) - The U.S. House of Representatives today okayed the Credit Card Accountability, Responsibility and Disclosure Act by a vote of 361-64. The Senate had earlier passed the Act onto the House by a vote of 90 to 5 Tuesday. Some of the problems that have been evident that this Act applies answers to, include over-the-limit fees, charges for paying by phone, and getting advance notice when the credit card company decides to raise your rate. It also addresses difficulties young people have regarding credit cards.

Wisconsin United Statess Senator Russ Feingold is in favor of the Credit Card Accountability Responsibility and Disclosure Act. Feingold would also like to see additional measures to reform credit card rules and regulations.

"Credit card contracts can be misleading and contain hidden charges and other provisions that stack the deck against consumers," Senator Feingold says.

"The Credit Card Bill of Rights will help put fairness back into these contracts by establishing easier-to-understand rules so consumers aren’t blindsided by fees or rate hikes," Feingold added.

"I’d like to see further reforms to credit card contracts, but the passage of this bill is still a victory for consumers,” Senator Feingold pointed out.

The Credit Card Accountability Responsibility and Disclosure Act passed the Senate by a vote of 90-5 before going on to the House of Representatives for further approval.

Under provisions of the Act, consumers who see their interest rate skyrocket because they have been late on a payment would get a chance at their older, lower rate if they pay their bill on time each month for six months.

The Credit Card Accountability and Disclosure Act of 2009 included two amendments offered by U.S. Senator Herb Kohl. These amendments require the co-signer of a credit card to approve any credit limit increase if the primary credit card holder is under the age of 21, and commissions a study by the Comptroller General regarding products that are marketed along with credit cards.

“Credit card companies have been taking advantage of their customers for years,” Senator Herb Kohl said. “Practices like universal default, raising interest rates for no reason and charging excessive fees have increased credit card profits while financially straining consumers."

"Clearly the industry will not self-correct, so legislation is necessary," Senator Kohl said.

The bill includes provisions to protect young people including banning credit card companies from sending unsolicited credit card offers to those under 21.

Additionally, the Kohl amendment -- Issuance of Credit Cards to Certain College Students -- requires any increase in credit limit to be approved by the co-signer of the credit card, which includes parents, guardians, and spouses for those under age 21. This amendment was included in the Banking Committee before the bill moved to a full Senate vote.

Senator Kohl also introduced a Credit Card Offers Study Amendment which requires the Comptroller General to conduct a study of products marketed in conjunction with credit cards with specific review of credit insurance products and debt cancellation and debt suspension agreements.

This study will do two things:

(1) allow Congress to review the nature and terms of products offered to credit card customers to determine if predatory practices and marketing are prevalent, and to determine if customers understand the products that are offered and the benefits that will be received; and

(2) allow Congress to determine if current legislation adequately protects consumers in their relationship with credit card companies or if additional protection for consumers is necessary.

"Many Americans depend on credit cards to get by in this economy, and today they have won a giant victory that ensures they are protected from practices that would drive them further into debt, while also making our economy stronger," said Sen. Christopher Dodd, D-Conn., chairman of the Banking Committee.

The Credit Card Accountability, Responsibility and Disclosure Act now goes to President Barack Obama for his signature.