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Final phase of CARD Act begins August 2010

In February 2010, the second phase of the Credit Card Accountability Responsibility and Disclosure (CARD) Act significantly changed the terms consumers were held to by credit card companies. The CARD Act generally made credit card terms more friendly to consumers, since all credit card companies are now held to the same standards.
There is more good news for consumers, especially those consumers who are in the process of rebuilding credit after bankruptcy. The third phase of the CARD Act will come into action in August 2010 and incorporate the following updates:

1. If the borrower makes a payment 60 days late and suffers an increased interest rate, six months of on-time payments will cause the interest rate to return to the original rate.

2. Gift cards will not expire before five years and will not be subject to inactivity fees.

Although this is good news, consumers should still be cautious. Credit card companies may create new rules or change the existing terms of your credit card agreement to counteract these mandatory changes. Read any changes carefully, and don’t forget to keep an eye on your overall credit by requesting your free annual credit report.