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While companies hold off on instituting new rules, consumers may consider debt consolidation to deal with high rates
01/25/2010
New federal regulations coming in February will require that lenders apply credit card debt payments to balances that have the highest interest rates.
A recent report from BusinessWeek featured the comments of Peter Pham, CEO of BillShrink, which is a company that offers credit card comparisons. Pham noted that lenders are waiting up until the deadline in order to comply with the new rules.
"No lender is doing it yet," Pham told the publication. "That will be the biggest impact across the board."
The requirements come courtesy of the Credit Card Accountability, Responsibility and Disclosure Act, which takes full effect in February. Along with requiring applying payments to the highest interest rates, the new rules will keep card companies from arbitrarily raising interest rates.
Though the laws are intended to protect consumers, they may not be enough for people who have already dug themselves deep into a debt hole. Those who have found their interest rates are too high to handle may consider debt consolidation, which may provide those in debt with lower interest rates.
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