Those New Laws Regarding Our Credit Cards

Have you gotten any notices about the changes?  I have received several.

My GE Money Lowe’s card (which I haven’t used in years) arrived with this information:

Due to new credit card regulatory requirements, we will no longer be permitted to offer “no payment” promotions. As a result, starting on February 1, 2010, any new financing promotions offered on your Lowe’s Consumer Credit Card will require minimum monthly payments during the promotional period. In the event that the regulatory requirements are changed in the future, we may being to offer “no payment” promotions again.

In addition, we wanted to let you know about special financing promotions that may be available to you when you use your Lowe’s Consumer Credit Card. From time-to-time, you may be offered one of the following promotions when you make a qualifying purchase:  NO INTEREST IF PAID IN FULL WITHIN 6, 12 OR 18 MONTHS

Under each of these promotions, if the promotional balance is not paid in full within the promotional period, interest will be imposed from the date of purchase at the APR that applies to your Account when the promotional purchase is made, which is currently an APR of 21.9%.

And then it goes on.

I wonder if people will pay attention to this, and if it will cause less business for Lowe’s. I think some find it a big attraction to buy their home remodeling items from Lowe’s and not have to pay interest.  But I wonder if they’ll realize if they don’t pay it all on time they will get socked for the interest FROM THE DATE OF PURCHASE.  OUCH.  That could be painful, especially if you made a large purchase.

So have you been getting any of those notices in the mail?

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12 thoughts on “Those New Laws Regarding Our Credit Cards

  1. Too many businesses survive only because of “credit”. And that is the problem with the economy. We will be in an adjustment phase because consumers have to get used to buying without credit (which is good since it implies you have saved and can pay in full) and businesses have to adjust to this new reality.

    Anyway (back to the topic), I’ve got other letters about late fees or APR increases, but since I pay in full, I honestly cannot be bothered with them!


  2. That’s where they get you. When we first got married we bought our living room furniture on under the same conditions…6 months interest free, but if the balance wasn’t paid in full when the term was up we’d be charged with the interest from the date of purchase. We made sure to pay it all off early so no harm done.


    Mrs. Accountability Reply:

    SMT: Glad you got your living room furniture paid off on time! I have heard that some companies do charge the full interest but had never experienced it with any of the companies I’d used. Thanks for sharing your experience!


  3. I thought that had always been true: if you don’t pay off one of those 12-month-no payments-no-interest deals by the due date, you get socked with a year of interest.

    The operative message here seems to be that those great don’t-pay-for-six months or a year deals herewith go away, thank you very much Uncle Sam. I’ve always used those for big-ticket purchases, stashing the payoff amount in an account that earned a little interest.

    Doesn’t much matter these days, anyway, since the “little” interest is so little it’s not worth the effort to move the money into a CD or money market account. bleh!


    Mrs. Accountability Reply:

    Hi Funny, I had heard about it for some companies, but never experienced it myself. Then again, I don’t think I’ve ever done one of those big purchases on credit. Yeah, the interest is miniscule!


  4. I received the SAME letter yesterday from Home Depot. Apparently the new credit card legislation is affecting this no interest promotion on all cards. Maybe this will encourage people to pay off their cards before interest fees accrue.


    Mrs. Accountability Reply:

    Hi Little House: I hope so, but somehow I doubt it for some folks. 🙁


  5. It is likely the credit card companies will find a way around this somehow.

    The important point is that a credit card is really under ones control. One simply pays it off and does not incur any further debt no matter how ‘enticing’ the offers are.

    The entire purpose of any offers is to encourage the consumer to have more debt as that means more interest paid and therefore more profit.


  6. The new CARD act has put enormous restrictions on card issuers … and rightfully so. Many of the old promotional ploys used in the past such as 0% APR, no fee balance transfers, cash back rewards have all been curtailed dramatically by card issuers because far more attention has been brought to onerous finance charges and late fees. Card issuers can no longer whack consumers over the head like they used. I expect to see some new “tricks” develop as these old tactics seem to be providing less profit to these companies than they have in the past.


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