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Dodd aims at suspending increases in credit card debt interest rates
10/27/2009
As consumers continue to try and deal with credit card debt, some lenders have changed interest rates and fees in anticipation of a consumer credit protection act.
The Credit Card Accountability, Responsibility and Disclosure Act was signed into law earlier this year, and some of its provisions took effect in August. Other rules are currently slated to take effect on February 22, 2010, which would include limiting a lender's ability to arbitrarily raise interest rates on credit card debt.
However, some card companies have tried to increase rates and fees before the Credit CARD Act takes full effect. In light of this, Connecticut Democratic Senator Chris Dodd presented legislation that would put a halt to interest rate and fee increases until provisions in the act come to bear.
"At a time when families are struggling to make ends meet, jacked up rates can quickly create crushing debt," Dodd said. "People need to be responsible with their money, but they shouldn't be taken to the cleaners by outrageous rates."
A number of other legislators have tried to speed up the implementation of the Credit CARD Act. For example, Barney Frank and Carolyn Maloney, who are both House Democrats, introduced legislation that would move the February rules up to December 1.
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