THE CREDIT CARD ACT OF 2009

Credit Card Act of 2009



Credit Card Act of 2009

Introduction

President Obama signs credit card accountability, Responsibility and Disclosure Act of 2009, also known as the credit card Act of 2009, the law of 22 May 2009. The law which will enter into force on 22 February 2010 restricts consumers ' credit card companies charge. This also makes it more difficult for students to get a credit card.

Act of 2009

Under the new law, consumers under the age of 21 must be 21 years of age cosigners and older, in order to apply for credit cards. If the consumer does not cosigners, they will need to show your own repayment of its debt. In other words, they will need to have a job and steady income (Connelly 2010).

The Act also requires the companies sending unsolicited pre-screened credit card offers to young consumers. Other restrictions include the use of creative individuals, such as free shirts, iPod and other prizes for those under 21.

The credit card Act of 2009 includes some new features for students who have not yet realized the importance of financial constraints. However, it also has the potential to impact students who depend on their credit cards to get them through school.

2009 national study with Sallie Mae found that increasing numbers of students must use a credit card to cover the costs of education. A 92 per cent of students which credit cards are charged in education spending in 2008. Almost 30 per cent to train at least one credit card. Average student will be charged for more than $ 2200 in the direct costs of education. In 2004 averaged just $ 942.

Impact on students

Almost 90 per cent of students, at least one credit card, according to the study «Sallie Mae. Average 4.6 credit cards per student. More than half of all students have four cards and more. Unfortunately, only 17% of those surveyed said they paid off the balance of the card each month. The remaining balance is payable financial costs (Lillis 2009).

It is important to note that the credit card Act of 2009 would not prohibit students from charging expenditure on education and obtain a credit card if they have cosigners or independent means of payment. However, this would certainly put a limit on the number of charge going to College.

Students who do not have their own credit history or parent or sponsor a loan ...