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New House bill would cap credit card at 16
WASHINGTON (12/1/09)--Rep. Louise Slaughter (D-N.Y.), with the assistance of Reps. John Tierney (D-MA) and Michael Capuano (D-MA), will soon introduce legislation that would cap yearly credit card interest rates at 16%. Slaughter’s legislation, which has been referred to as the Renewing America’s Commitment to Consumers Act, would, according to a press release, seek to “prevent the kind of dramatic rate hikes consumers - even those with strong credit histories and who have paid their balances on time - have been experiencing.” The bill, as currently written, would also cap contingency fees, including late payment fees, at $15, and would limit membership fees and annual fees, but would allow temporary rate cap increases “in extraordinary circumstances and upon regulatory finding that modification maintains the goal of protecting consumers from exploitive lending practices.” The provisions of the legislation would not “supersede any state law with a lower usury cap,” according to the release. Rep. Tierney also praised the potential legislation, saying that it would fight the “exploitive practices” of some credit card issuers that are “unfairly and arbitrarily” raising interest rates “across more customer accounts than ever before.” Capuano in a statement added that the bill, which “will protect consumers by ensuring access to affordable credit,” could not “come at a more critical time."


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