HOUSE PASSES 2009 CREDIT CARDHOLDERS’ BILL OF RIGHTS LEGISLATION UNDER SPECIAL RULE

The House Rules Committee on April 29 introduced a resolution (H. Res. 379) providing for expedited consideration of the Credit Cardholders’ Bill of Rights Act of 2009 (H.R. 627). On April 30, the House passed the resolution, promptly began debating H.R. 627 and passed the bill with several amendments by a final vote of 357 to 70. A similar bill passed the House under a special rule last year, but then died in the Senate. See Alert dated September 24, 2008. The enrolled version of the Act has many new provisions that will be onerous for creditors, including, but not limited to:

• Additional restrictions on college credit cards;
• A requirement that creditors post credit card agreements on the Internet;
• New minimum payment warning disclosures;
• New solicitation disclosures regarding excessive credit inquiries;
• New readability requirements for credit card applications and disclosures (including a specific requirement to use 12-point type); and
• New disclosure requirements for stores accepting credit card account applications.

The Act provides for an effective date of the earlier of (i) 12 months after enactment or (ii) June 30, 2010, but the advance notice for rate increases requirement would become effective 90 days after enactment.

Contact us for more details on the bill.

• Margaret Stolar and Vanessa Nelson