When getting ready to go to college my mother told me not to sign up for any credit cards offers unless I talked to her first. College students are constantly targeted by credit card companies at college fairs, pre-approved cards, freebies and more. But not so much anymore thanks to the new credit card from reform. Credit Card Accountability, Responsibility and Disclosure Act of 2009, also known as the Credit CARD Act, will go into effect on Feb. 22, 2010. This is meant to help protect people from credit card companies hidden fees, change in APR (interest), and fine print. When proposing the bill President Obama said, "Americans know that they have a responsibility to live within their means and pay what they owe but they also have a right to not get ripped off by the sudden rate hikes, unfair penalties and hidden fees that have become all too common in our credit card industry."
The Credit CARD Act has many aspects to help Americans, and is going to attempt to help the Under 21year olds who often get swept up in the instant gratification of credit. The Act will affect Under 21 year olds in several ways:
• Credit for young consumers: Ban credit cards for people under 21 unless they have a co-signer or proof that they have income to pay them back, Bans pre-screening and pre approved credit cards, and the Under 21 year old has get permission from co-signer to increase credit limits on joint accounts
• College marketing: Colleges have to disclose the student information they give credit card information; Credit card issuers are required to file annual reports with the Federal Reserve Board detailing the terms and conditions of all business, marketing and promotional deals with colleges and universities, including the amount of any payments made to the school; Recommend colleges universities and alumni associations to not allow credit card companies to promote on campus or near campus (now near campus is defined as 1,000 miles from the border of the campus)
• No more freebies or promotional gifts to get young
College students have already reacted. Some student like Cierra Jackson, a 21-year-old public relations major at Florida A & M University, says "I think it's a good law. Most people get credit cards and are in debt before they finish their first year in college." While others are strongly opposed like Todd VanDuzer, 19, a business major at Arizona State University (ASU) in Tempe. He says he has Capital One and Chase credit cards with no debt. He says, "I think such a law is ridiculous because it is further limiting our rights that we deserve as adults. If we can get tried in court as an adult and go to war, we deserve the same rights as an elder would.
Video and more after the Break
More opinions in this video:
As a first year college student I think it’s a great idea, except what about students whose parents don’t have good credit? Will they have to wait until they are older and will their parents credit history reflect upon them? This Credit CARD Act is just one of many to try to help us Americans out of this recession. What do you think? Good Idea or Not?