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The CARD Act: by the numbers

The CARD Act, as we discussed last week here on our Long Island bankruptcy law blog, made a number of changes intended to protect consumers. It significantly restricted the tactics that companies can use against borrowers with credit card debt. Some practices are no longer permitted at all.

It's one thing, of course, to point to changes in the law and say that people's lives will be better because of them. But has the CARD Act really had an impact on consumers? Let's take a look at some statistics offered by the Consumer Financial Protection Bureau, the agency responsible for administration of the CARD Act. The information is intended to be general in nature only and does not constitute specific legal advice.

Interestingly, more consumers express awareness that their monthly billing statements changed, but not many seem to be aware of the CARD Act itself. Eighty percent, for example, noticed after the CARD Act's implementation that their payments fall on the same date every month. Slightly fewer have seen the new late-payment warning in their statements. Seventy percent reported that they noticed new information about the drawbacks of making just the minimum payments.

Does the new information change how consumers handle their debt? Nearly one in three of those who noticed the changes said yes, they are either paying more on their cards or using credit less. Twice as many report that their new statements, as well as the cardholder terms and conditions, are more easily understood and clearer than they were prior to the CARD Act.

Greater clarity and understanding are positive changes in the credit card industry and can help consumers make better informed decisions. Of course, many reading this will still be struggling with debt that they may have incurred before the Act took effect. More comprehensive financial solutions for individuals' specific situations are available; a legal professional can help.

Source: Consumer Financial Protection Bureau, "CARD Act factsheet," accessed on Dec. 11, 2015

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