The Credit Card Accountability Responsibility and Disclosure Act of 2009 or the Credit Card Act of 2009 is one of the largest reform measures imposed on the credit card industry. The intent of the act is to increase protection for consumers. The Credit Card Act of 2009 consists of thirty-three pages of complex material that contains significant information for credit card users.

A few of the reforms under this legislation are listed below:

• Eighteen to twenty year olds will no longer be able to get a credit card without a cosigner.
• Cardholders will have a right to reject an interest rate hike.

On December 1st, when the legislation takes effect, credit card companies will begin informing consumers in writing that their rate will be increased and card owners will be able to reject the increase. The rejection would result in the account being closed, but would still allow a consumer to continue paying off the balance at the current interest rate.

• The way in which credit card companies apply monthly payments to a credit card balance will change.

For example, suppose someone has a five thousand dollar balance at eleven percent APR and then transfers one thousand dollars to that card at a zero-percent promotional rate. Under the Credit Card Act of 2009, credit card companies must use the monthly payment to pay off the balance with the larger interest rate first. Therefore, in this case, payments would pay off the five thousand dollars at twelve percent first, thus preventing consumers from being stuck with large interest charges.

Those are a few of the major changes to be expected. Hopefully the act will make the credit card industry more consumer friendly.

If you live in Denver, Aurora, Arvada, Brighton, Broomfield, Commerce City, Englewood, Highlands Ranch, Lakewood, Lafayette, Littleton, Northglenn, Westminster, Wheat Ridge, or Golden, Colorado, and have any questions please feel free to contact me.  Kevin D. Heupel,  Colorado Bankruptcy lawyer,   303-955-7570,     Colorado Bankruptcy Help Email, personal bankruptcy free-consultation form.