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How does the CARD Act protect Tennessee families?


It is bad enough to deal with credit card debt, particularly when someone, at the same time, also has other issues, like unemployment or mounting medical bills from a recent and unexpected procedure. It is even worse when credit card companies take advantage of their customers, and families do not realize it until it is too late.

Fortunately, federal law offers some protections to families. About a decade ago, Congress passed the CARD Act, which was designed to protect consumers in Tennessee and around the country from the most common and aggressive techniques of credit card companies.

This law offers important rights and options to customers, and credit card companies can get into a lot of legal trouble, if they do not follow its provisions. For instance, the law made it so that credit card companies cannot unilaterally hike their interest rates without notice, except when the company is specifically offering a promotional rate. If they want to change their terms of coverage, credit card companies have to give advanced notice.

The CARD Act also requires greater clarity. Before its passage, someone might think that he or she needed a degree in law or finance to understand a credit card offer or agreement. Now, there are some plain English provisions, which require companies to spell out clearly a customer's options.

Advocates for consumers have applauded the CARD Act as a great step toward protecting Tennesseans from what some could well describe as predatory lending. However, the Act does not excuse debtors from their legitimate credit card balances. If a debtor is facing overwhelming financial problems because of a credit card, bankruptcy may be a viable option.

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