Thursday, March 25, 2010

Few people can claim to be 100% satisfied with their credit card services, and with good cause: credit cards exercise notoriously unethical practices on many occasions. But with the new CARD Act in effect, you'll see some big changes over the next few months.

Keeping up with credit card services

A word of caution: as of right now, no one's entirely sure what the fallout from the CARD Act will look like. The laws are set, but how the companies respond -- and what the consumers do -- remains to be seen. With that in mind, there are two things you should do to keep up to date:

* Become very familiar with the terms of your credit card services. Read the fine print. Know exactly what your card can -- and can't -- get away with.

* Keep up with new information. Follow sites like Credit Card Whiz Kid, which tend to have excellent up to date information on new services and updates.

The Good

Under the new CARD Act, credit card services will take a turn for the more ethical. Two of the industry's primary slimy practices -- random rate increases and double cycle billing, where they calculate interest based on your average daily balance instead of the balance you owe at the month's end -- are now illegal.

The credit cards are waiting to see what sort of fines the government plans to impose on violators, but you can rest assured that most of these issues are a thing of the past. This is a huge victory for consumers, and will make credit card use much more comfortable.

The Bad

In the past, credit cards haven't made a lot of money through ethical lending and scrupulous credit card services. They've made it through these unethical practices. With that in mind, credit cards have responded to these new laws by finding other ways to make money. Just a few of those include:

* Increased scrutiny of prospective clients (in other words, making it harder to get a credit card)

* Reduced rewards and incentive programs

* Higher annual fees

* Higher penalties for late or missed payments

So although there's a lot of good coming from the CARD Act, there's going to be some fallout, too. Your best bet? Keep a close eye on your credit card services and stay up to date on the information as it becomes available.

For more tips on the credit card services, saving money and avoiding getting taken, check out CreditCardWhizKid.com, a website that specializes in providing credit card tips, advice and resources.