Credit Card Bill passes the Senate
The new credit card bill passed the Senate today by a margin of 90-5. The bill contains a provision to limit the practice known as "universal default rate". The universal default rate is a practice whereby a credit card company would increase your interest rate (usually very high) for being late on either that card or ANY OTHER debt you have. Under the new bill the credit card companies would not be able to raise your rates until you are 60 days past due and even then they would have to restore the lower rate if the consumer makes 6 months of minimum payments on time.
The new bill would also impose restrictions on credit cards for people until 21. Under the bill, credit card applicants who are under 21 years of age would be required to prove their ability to pay or have a parent or guardian co-sign the account.
I personally applaud the legislative part which puts a stop to the "universal default rate" practices but I do not like the provision which restricts cards to people under 21. let me get this straight. At 18, you are a legal adult. You can sign a contract, buy a car, buy a home, but you still need Mommy and Daddy to co-sign for a credit card?
Tell me what your thoughts are on those two provisions of the new bill.