AmEx Under the Wire, Today the Law Changes

Ahead of today’s deadline for credit card reform, AmEx let me know they were going to be making some changes to my account.

• Bad news:  higher rates on purchases, cash advances, balances with a penalty rate due to late payments and of course, higher late fees.
• Good news:  no fee for going over the credit limit.

What a puzzle this is.  They tell me that I’m going to have higher rates, but there is no clear place where I can see what all the new rates are.  That is until I flip the page over.  Now, I have to admit it, I missed reading this page the first 5 times I looked at this.

Meanwhile,  I’ve been a user of auto-pay for a couple of years.  I’ve never been late, but I don’t take this personally.  These are global changes that everyone has to be on the look out for.  I don’t believe that the government should set prices, so I have to be okay with these changes.  But, disclosure is another issue.  This would be like getting a tuition increase notice without them telling you what the increase is.  Disclosure is the key.

So, let’s look at the back page….

Er…. no wonder I missed it the first time.  As if the language isn’t confusing to begin with [the prime plus...blah, blah, blah] this page also doesn’t let us know what the fees used to be.   That doesn’t really give me enough information does it?  Maybe late fees were $35 and now they are $39….seems fair.  Or maybe late fees were $3 and now they are $39….  hmmm maybe I should shop around for a new card.  I could spend hours trying to dig this information out.  Which, I will never do.  Without clear front page information, a consumer can’t make an educated choice.

Credit card reform changes that went into effect today :

Credit card companies must provide 45 days notice before making significant changes in their agreements with customers. Consumers can also reject the changes, triggering an option to wind down their balances over 5 years.

Lenders are prohibited from charging late fees on bills not mailed 21 days in advance of a payment due date, it used to be 14 days notice.

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• Higher FICO Credit Scores – Lesson #6
• Annoying Myth: Paying off Full Each Month Doesn’t Build Credit Scores – Episode #106
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