Too often, Senator Bayh hears from Hoosiers who sign up for a new credit card thinking they are getting the interest rate advertised on the envelope—only later to learn the credit card company has the right to hike their rates and increase their fees at any time, for any reason.

The stories are frightening:

• A woman in Carmel had an $8,000 balance on a closed credit card account. She always paid her bill on time. One day, her credit card company doubled her minimum payment. She couldn’t make the higher payment.  She called the bank, and they wouldn’t work with her, even though she had never missed a payment or been late in the past. Soon, the credit card company started adding late fees and compounding her interest. Over the course of two years, her balance tripled from $8,000 to $24,000 without making a single purchase.


• A Hoosier from Middlebury received an offer to consolidate her balances from three other credit cards at a four percent rate. That’s a good rate, so the woman accepted the offer. She also never missed a payment. And she had paid off half her debt, when suddenly they raised the monthly minimum payment by 60 percent—without cause or notice. She called to complain, and they said they would lower her minimum payments back to the original level if she would agree to have her interest rate doubled. She is playing by the rules, but her credit card company is making it more difficult to make ends meet. This woman asked if her government can do anything about these abuses.

There is something that can be done, and Senator Bayh is trying. He is pushing legislation to increase credit card transparency and protect consumers from hidden fee increases and interest rate hikes that make it more difficult for some middle-class families to dig out of debt.

Senator Bayh is seeking to outlaw these types of abuses that are exploiting hard-working, middle-class Hoosier being unfairly squeezed by credit card companies. He believes there needs to be safeguards in place so banks can’t balance their books on the backs of middle-class Hoosiers—and that’s exactly what the Credit Card Accountability Responsibility and Disclosure Act of 2009 does.

Specifically, the legislation protects the rights of financially responsible credit card users by:

• Prohibiting interest charges on debt paid on time;
• Prohibiting late fees if the card issuer delayed crediting the payment;
• Requiring credit card statements to be mailed 21 days before the bill is due rather than the current 14;
• Requiring payment at local branches be credited on the same day.

The economy is in crisis. People are losing their jobs. Home values are down. Hoosiers who pay their bills on time and meet the terms of their agreement should not be exploited.  It’s not fair and it’s time Congress did something about it.

Share your thoughts with Senator Bayh.

Read stories from Americans about the credit card abuses Senator Bayh is fighting.

WISH TV: Bayh Fighting for New Credit Card Laws

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The Credit CARD Act

Strengthens Credit Card Industry Regulation and Supervision

• Requires banking regulators to evaluate the policies and procedures of card issuers to ensure compliance with card requirements and prohibitions;
• Improves data collection related to rates, fees, and profits;
• Provides each federal financial regulator with the authority to prescribe regulations governing unfair or deceptive practices by banks and savings and loan institutions.

Prevents “any-time, any reason” Increases in Interest Rate and Terms

• Prevents credit card issuers from increasing interest rates on cardholders in good standing for reasons unrelated to the cardholder’s behavior with respect to that card (universal default ban);
• Prevents issuers from changing the terms of a credit card contract for the length of the card agreement (ban on unilateral changes to card agreements);
• Allows customers who close their accounts to pay under the terms existing at the time the account is closed;
• Requires interest rate increases to apply only to future credit card debt.

Requires Fairness in Application of Card Payments

• Requires payments to be applied first to the credit card balance with the highest rate of interest, and to minimize finance charges;
• Prohibits issuers from setting early morning deadlines for credit card payment.

Protects the Rights of Financially Responsible Credit Card Users

• Prohibits interest charges on debt paid on time (double-cycle billing ban);
• Prohibits late fees if the card issuer delayed crediting the payment;
• Requires credit card statements to be mailed 21 days before the bill is due rather than the current 14;
• Requires that payment at local branches be credited same-day.

Prohibits Exorbitant and Unnecessary Rates and Fees

• Prohibits the charging of interest on credit card transaction fees, such as late fees and overlimit fee;
• Prohibits issuers from charging a fee to allow a credit card holder to pay a credit card debt, whether payment is by mail, telephone electronic transfer, or otherwise;
• Prevents issuers from multiple over-limit fees for exceeding a card limit, and allows such fees only when a cardholder’s action, rather than a fee or finance charge, causes the limit to be exceeded;
• Requires issuers to offer consumers the option of operating under a fixed credit limit;
• Requires issuers to lower penalty rates that have been imposed on a cardholder after 6 months if the cardholder commits no further violations.

Provides Enhanced Disclosures of Card Terms and Conditions

• Requires cardholders to be given 45 days notice of any interest rate increase;
• Requires issuers to provide disclosures to consumers upon card renewal when the card terms have changed;
• Requires issuers to provide individual consumer account information and to disclose the period of time and total interest it will take to pay off the card balance if only minimum monthly payments are made;
• Requires full disclosure in billing statements of payment due dates and applicable late payment penalties.

Ensures Adequate Safeguards for Young People

• Requires issuers soliciting to persons under the age of 21 to obtain an application that contains: the signature of a parent, guardian, or other individual who will take responsibility for the debt; proof that the applicant has an independent means of repaying any credit extended; or proof that the applicant has completed a certified financial literacy course;
• Limits prescreened offers of credit to young consumers by prohibiting consumer reporting agencies from furnishing reports in connection with firm offers of credit that are not initiated by consumers under age 21. Allows consumers who are at least 18, but not yet 21, to choose to receive such solicitations.

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