Credit Card Accountability Responsibility and Disclosure Act of 2009 (Credit CARD Act) was signed into law by President Obama on May 22, 2009. The Credit CARD Act places prohibitions on five practices that the Office of Thrift Supervision (OTS) and other agencies consider to be unfair. The act also amends Truth in Lending rules. However, most of the new credit card praticies that will be prohibited do not take effect until February 22, 2010.

There are two provisions that do take effect on August 20, 2009, a short 90 days after the bill was signed into law. The two portions of the act that take effect this week include:

• Requiring a creditor to provide written notice not later than 45 days prior to the effective date of: (1) any increase in an annual percentage rate (APR); and (2) any significant change, as determined by rule of the Federal Reserve Board, in the terms of the cardholder agreement (including an increase in fees or finance charges).
• Revising requirements for the timing of payments and the grace period. Requires each periodic statement of payment due to be mailed at least 21 days before the payment due date or grace period expiration date.

While these provisions are only a small step, they do help protect consumers. The extension of notification of payment due can help consumers stay current easier, hopefully eliminating fees associated with late payments. By providing more notice to a change in terms allows consumers to shop around for a credit card with better rates, lower fees, or increased benefits. Remember to check with your local credit union for very competitive rates and terms on credit cards.

How will the Credit CARD Act help you? Let us know by commenting below.

If you have more credit card debt than you want, check out our Credit Card Payoff Calculator to see how long it will take to pay off that pesky debt.