Credit Cardholders' Bill of Rights Act of 2008

Bill: 110-hr-5244
Sponsor: Rep. Maloney, Carolyn B. [D-NY-14]
Introduced: 2008-02-07 in the House
Policy area: Finance and Financial Sector
Subjects: Commerce
Consumer credit
Consumer education
Consumer protection
Contracts
Credit cards
Debtor and creditor
Fees
Financial statements
Government Operations and Politics
Government paperwork
Government publicity
Interest rates
Standards

Summary:
action_date: 2008-02-07
text: 
Credit Cardholders' Bill of Rights Act of 2008 - Amends the Truth in Lending Act to prohibit a creditor from using certain adverse information, including information in a consumer report or any change in a consumer's credit score, as the basis for increasing any annual percentage rate (APR) of interest on the consumer's outstanding balance under an open end consumer credit plan, except for actions or omissions of the consumer directly related to such account. (Thus eliminates the universal default for credit already outstanding.)
 
Bars a creditor from changing any term of the contract or agreement of an open end consumer credit plan until contract renewal, except for specific material reasons already contained in the contract or agreement.
 
Requires advance notice of credit card account rate increases.
 
Authorizes a consumer who receives such notice to: (1) cancel the credit card without penalty or the imposition of any fee; and (2) pay any outstanding balance that accrued before the effective date of the increase at the APR and in the repayment period in effect before notice was received.
 
Prohibits a creditor from imposing interest on credit repaid within the interest-free repayment time period. (Thus prohibits double cycle billing).
 
Prohibits the imposition of fees on any outstanding balance on a credit card account attributable only to accrued interest on previously repaid credit.
 
Requires each periodic statement of account to provide specified information on obtaining the payoff balance.
 
Prohibits a creditor from furnishing information to a consumer reporting agency concerning a newly opened credit card account until the consumer has used or activated the credit card.

Details mandatory pro rata payment allocations by a creditor.

Authorizes a consumer to opt-out of creditor authorization of over-the-limit transactions if fees are imposed.
 
Restricts the frequency of over-the-limit fees.
 
Specifies the contents of credit card price and availability information the Board of Governors of the Federal Reserve System must collect and make public semiannually.
 
Prescribes a standard for the initial issuance of subprime or &quot;fee harvester&quot; cards (accounts requiring first-year fee payments in excess of 25% of the total amount of credit authorized).

action_date: 2008-09-16
text: 
Credit Cardholders' Bill of Rights Act of 2008 - (Sec. 2) Amends the Truth in Lending Act to prohibit a creditor from increasing any annual percentage rate of interest (APR) applicable to the existing balance on an open end consumer credit card account unless specified conditions are met. 

Prescribes the treatment of existing balances following a rate increase.
 
Allows a creditor to increase an APR on the existing credit card balance only if the increase is due solely to: (1) the operation of an index not under the creditor's control and available to the general public; (2) expiration of a promotional rate, or loss of a promotional rate for a reason specified in the account agreement (e.g., late payment); or (3) the consumer's minimum payment has not been received within 30 days after its due date.
 
Requires a 45-day advance notice of credit card account rate increases.
 
(Sec. 3) Prohibits imposition of a finance charge, with certain exceptions, upon a credit card account balance that is based on balances for days in billing cycles preceding the most recent billing cycle (double cycle billing).
 
Prohibits the imposition of a fee on an outstanding credit card balance, at the end of a billing period, that is attributable only to interest accrued during the preceding billing period on an outstanding balance fully repaid during that preceding billing period. Declares that any failure to make timely repayments of such a balance shall not constitute a default on the account.
 
Requires each periodic statement of account to provide the telephone number, Internet address, and Worldwide Web site at which the payoff balance may be requested.
 
Grants a consumer the right to reject a new credit card before the creditor notifies a consumer reporting agency of its corresponding account
 
Details mandatory pro rata payment allocations by a creditor where an outstanding balance accrues interest at two or more different APRs.
 
Sets forth special rules for accounts with promotional rate balances or deferred interest balances. 
 
Prohibits a creditor from denying a cardholder a specified payment grace period if the cardholder takes advantage of a promotional rate balance or deferred interest rate balance.
 
Requires creditors to send a periodic credit card statement of account to the consumer at least 25 calendar days before the due date for the next payment on the outstanding balance.
 
(Sec. 4) Authorizes a consumer to opt-out of creditor authorization of over-the-limit transactions if fees are imposed.
 
Limits any imposition of an over-the-limit fee to once per billing cycle.
 
Prohibits imposition of any over-the-limit fee if the credit limit was exceeded due to a credit hold, unless the actual amount of the transaction for which the hold was placed would have resulted in the consumer's exceeding such credit limit.
 
(Sec. 5) Prescribes the contents of credit card price and availability information which the Board of Governors of the Federal Reserve System (Board) must collect and make public semiannually.

Requires the Board to report to Congress annually on estimates of the approximate, relative percentage of income derived by the credit card operations of depository institutions from designated sources, including interest rates and fees imposed upon cardholders.
 
(Sec. 6) Prescribes a standard for the initial issuance of subprime or &quot;fee harvester&quot; cards (accounts requiring first-year fee payments in excess of 25% of the total amount of credit authorized).
 
Prohibits payment of any such fees (other than late fees or over-the-limit fees) from the credit made available by the card.
 
(Sec. 7) Prohibits extensions of credit to consumers under age 18, unless they are emancipated under state law.
 
(Sec. 8) Requires the Board to prescribe regulations implementing this Act within six months after its enactment. 
 
Expresses the sense of Congress, all the same, that no provision of this Act should impede the promulgation of final regulations under laws in effect on the day before the date of enactment. States that such regulations should: (1) be prescribed in final form on or before December 31, 2008; and (2) apply to credit card transactions after the 30-day period following issuance in final form.

action_date: 2008-09-23
text: 
Credit Cardholders' Bill of Rights Act of 2008 - (Sec. 2) Amends the Truth in Lending Act to prohibit a creditor from increasing any annual percentage rate of interest (APR) applicable to the existing balance on an open end consumer credit card account unless specified conditions are met. 

Prescribes the treatment of existing balances following a rate increase.

Allows a creditor to increase an APR on the existing credit card balance only if the increase is due solely to: (1) the operation of an index not under the creditor's control and available to the general public; (2) expiration of a promotional rate, or loss of a promotional rate for a reason specified in the account agreement (e.g., late payment); or (3) the consumer's minimum payment has not been received within 30 days after its due date.

Requires a 45-day advance notice of credit card account rate increases.

(Sec. 3) Prohibits imposition of a finance charge, with certain exceptions, upon a credit card account balance that is based on balances for days in billing cycles preceding the most recent billing cycle (double cycle billing).

Prohibits the imposition of a fee on an outstanding credit card balance, at the end of a billing period, that is attributable only to interest accrued during the preceding billing period on an outstanding balance fully repaid during that preceding billing period. Declares that any failure to make timely repayments of such a balance shall not constitute a default on the account.

Requires each periodic statement of account to provide the telephone number, Internet address, and website at which the payoff balance may be requested.

Grants a consumer the right to reject a new credit card before the creditor notifies a consumer reporting agency of its corresponding account.

Details mandatory pro rata payment allocations by a creditor where an outstanding balance accrues interest at two or more different APRs.

Sets forth special rules for accounts with promotional rate balances or deferred interest balances. 

Prohibits a creditor from denying a cardholder a specified payment grace period if the cardholder takes advantage of a promotional rate balance or deferred interest rate balance.

Requires creditors to send a periodic credit card statement of account to the consumer at least 25 calendar days before the due date for the next payment on the outstanding balance.

(Sec. 4) Authorizes a consumer to opt-out of creditor authorization of over-the-limit transactions if fees are imposed.

Limits any imposition of an over-the-limit fee to once per billing cycle.

Prohibits imposition of any over-the-limit fee if the credit limit was exceeded due to a credit hold, unless the actual amount of the transaction for which the hold was placed would have resulted in the consumer's exceeding such credit limit.

(Sec. 5) Prescribes the contents of credit card price and availability information which the Board of Governors of the Federal Reserve System (Board) must collect and make public semiannually.

Requires the Board to report to Congress annually on estimates of the approximate, relative percentage of income derived by the credit card operations of depository institutions from designated sources, including interest rates and fees imposed upon cardholders.

(Sec. 6) Prescribes a standard for the initial issuance of subprime or &quot;fee harvester&quot; cards (accounts requiring first-year fee payments in excess of 25% of the total amount of credit authorized).

Prohibits payment of any such fees (other than late fees or over-the-limit fees) from the credit made available by the card.

(Sec. 7) Prohibits extensions of credit to consumers under age 18, unless they are emancipated under state law.

(Sec. 8) Requires the Board to prescribe regulations implementing this Act within six months after its enactment. 

Expresses the sense of Congress that no provision of this Act should impede the promulgation of final regulations under laws in effect on the day before the date of enactment. States that such regulations should: (1) be prescribed in final form on or before December 31, 2008; and (2) apply to credit card transactions after the 30-day period following issuance in final form.


Legislative actions:
action_date: 2008-10-02
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
action_date: 2008-09-24
text: Received in the Senate.
action_date: 2008-09-23
text: Motion to reconsider laid on the table Agreed to without objection.
action_date: 2008-09-23
text: On passage Passed by recorded vote: 312 - 112 (Roll no. 623). (text: CR H8598-8602)
action_date: 2008-09-23
text: Passed/agreed to in House: On passage Passed by recorded vote: 312 - 112 (Roll no. 623).(text: CR H8598-8602)
action_date: 2008-09-23
text: On motion to recommit with instructions Failed by the Yeas and Nays: 198 - 219 (Roll no. 622). (text: CR H8612-8613)
action_date: 2008-09-23
text: The previous question on the motion to recommit with instructions was ordered without objection. (consideration: CR H8598-8613)
action_date: 2008-09-23
text: DEBATE - The House proceeded with 10 minutes of debate on the Castle motion to recommit with instructions. The instructions contained in the motion seek to require the bill to be reported back to the House with an amendment inserting a new section providing a trigger for enactment.
action_date: 2008-09-23
text: Mr. Castle moved to recommit with instructions to Financial Services. (consideration: CR H8611-8612; text: CR H8612)
action_date: 2008-09-23
text: The previous question was ordered pursuant to the rule. (consideration: CR H8612)
action_date: 2008-09-23
text: DEBATE - The House proceeded with one hour of debate on H.R. 5244.
action_date: 2008-09-23
text: Rule provides for consideration of H.R. 5244 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions except motion to recommit with or without instructions. Measure will be considered read. Bill is closed to amendments. All points of order against consideration of the bill are waived except those arising under clause 9 or 10 of rule XXI. The amendment in the nature of a substitute recommended by the Committee on Financial Services now printed in the bill shall be considered as adopted.
action_date: 2008-09-23
text: Considered under the provisions of rule H. Res. 1476. (consideration: CR H8598-8613)
action_date: 2008-09-23
text: Rule H. Res. 1476 passed House.
action_date: 2008-09-22
text: Rules Committee Resolution H. Res. 1476 Reported to House. Rule provides for consideration of H.R. 5244 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions except motion to recommit with or without instructions. Measure will be considered read. Bill is closed to amendments. All points of order against consideration of the bill are waived except those arising under clause 9 or 10 of rule XXI. The amendment in the nature of a substitute recommended by the Committee on Financial Services now printed in the bill shall be considered as adopted.
action_date: 2008-09-16
text: Placed on the Union Calendar, Calendar No. 554.
action_date: 2008-09-16
text: Reported (Amended) by the Committee on Financial Services. H. Rept. 110-857.
action_date: 2008-09-16
text: Reported (Amended) by the Committee on Financial Services. H. Rept. 110-857.
action_date: 2008-07-31
text: Ordered to be Reported (Amended) by the Yeas and Nays: 39 - 27.
action_date: 2008-07-31
text: Committee Consideration and Mark-up Session Held.
action_date: 2008-07-31
text: Subcommittee on Financial Institutions and Consumer Credit Discharged.
action_date: 2008-04-17
text: Subcommittee Hearings Held.
action_date: 2008-04-17
text: Referred to the Subcommittee on Financial Institutions and Consumer Credit.
action_date: 2008-02-07
text: Referred to the House Committee on Financial Services.
action_date: 2008-02-07
text: Introduced in House
action_date: 2008-02-07
text: Introduced in House