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Standup: If you've ever been nailed by a credit card late-payment fee or had your interest rate raised unfairly, this next story is for you. Because changes may be on the horizon. Bankrate.com explains.
Voice over 1: The ability to buy now, pay later. The convenience. The safety of not carrying cash: credit cards offer some nice benefits. Unfortunately, those benefits often come at a price.
SOT: "Raising your interest rates if your credit score goes down, charging you late fees even though they mailed out your statement very close to the due date, apply your payments to lower interest rates, effectively locking in the higher interest rates...
Voice over 2: But credit card expert Scott Bilker is encouraged these days because of new rules reposed by the Federal Reserve: rules that could protect consumers by curbing abuses and increasing disclosures.
Voice over 3: For example, banks would have to establish a reasonable policy for late payments.
SOT: "The proposal is to make sure consumers have 21 days between the time they get their statement to the time they have to pay, so they can pay on time."
Voice over 4: Another proposed change would force banks to apply extra payments to higher interest rate balances first.
SOT: "What banks do is they allocate your payments to the lowest interest rate first, thus locking in your balance that's the highest rate."
Voice over 5: Two cycle billing...a method some cards use to boost interest fees... would also be gone.
Voice over 6: As far as consumer advocates like Scott are concerned, the only problem with these proposed changes is just that: they're proposed.
SOT: "If we want them to become adopted rule, we have to let the Federal Reserve know by commenting about these changes."
Standup: And that's exactly what we should do. If you're mad at your credit card company and don't want to take it anymore, now's your chance to do something about it. Stand up and be counted. For Bankrate.com I'm Kristin Arnold.
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