April 24, 2014

Scrolling Headlines:

Bowl Weekend set to be ‘very successful’ -

Thursday, April 24, 2014

Win-and-in situation looms for UMass men’s lacrosse against Delaware -

Thursday, April 24, 2014

Brewed of the Gods – Dogfish Head Theobroma -

Thursday, April 24, 2014

Never again, never forget: Remembering the Armenian genocide -

Thursday, April 24, 2014

No. 11 UMass women’s lacrosse prepares for final two regular season games -

Thursday, April 24, 2014

Food of the World: Vietnam -

Thursday, April 24, 2014

Indie duo The Both to perform at Pearl Street -

Thursday, April 24, 2014

USDA grants awarded to UMass faculty -

Thursday, April 24, 2014

UMass baseball team heads to Bronx for three-game set vs. Fordham -

Thursday, April 24, 2014

Workout on the Quad comes to UMass -

Thursday, April 24, 2014

Time to reconsider ‘war on terror’ -

Thursday, April 24, 2014

UMass men’s lacrosse has received solid play from freshmen all year -

Thursday, April 24, 2014

Renowned rabbi discusses the role of religion in American policy -

Wednesday, April 23, 2014

UMass baseball haunted by missed opportunities in 8-5 loss -

Wednesday, April 23, 2014

‘Transcendence’ a fumbling cautionary tale -

Wednesday, April 23, 2014

Freedom of speech for campus employees -

Wednesday, April 23, 2014

‘Veep’ continues to be one of the smartest comedies around -

Wednesday, April 23, 2014

‘Noah’ a sinking ship -

Wednesday, April 23, 2014

Letter: A response to ‘There is nothing to debate about global warming’ -

Wednesday, April 23, 2014

Push for punishment equality -

Wednesday, April 23, 2014

How new credit card rules will impact students

A series of new restrictions for credit card companies, which went info effect last week after being passed Congress a year ago, will impact anyone who has a credit card, but it will especially affect college students.

Credit card companies have long used questionable marketing practices in order to get America’s youth to sign up for a credit card. The companies often see young adults as being inexperienced with managing finances and therefore much more likely to misuse credit cards and therefore pay more in penalties.

“In spring of 2008, only 15 percent of freshmen had a zero balance, down dramatically from 69 percent in the fall of 2004. The median debt freshmen carried was $939, nearly triple the $373 in 2004,” according to Sallie Mae’s “How Undergraduate Students Use Credit Cards,” published April 2009.

Generally, credit card companies use methods such as switching payment dates and raising credit limits so that cardholders incur debt.  This extra debt means a number of new fees and increased interest rates, which is how these companies make their money.

With the new legislation kicking in, these practices have been at least regulated, if not banned.  The following restrictions in the “Credit Card Accountability Responsibility and Disclosure Act” (Credit CARD Act) passed on March 19, 2009, will directly affect students:

  • New laws will require a co-signer for student applicants under 21, unless they can prove they have a steady source of income.
  • No more freebies: companies are no longer allowed to offer students token gifts such as free pizza or t-shirts, etc. just for applying.
  • Fewer prescreened offers, meaning companies such as Equifax or Experian can not send credit card companies your information in order for them to send out “pre-approved offers.”
  • More transparency about college affinity card programs, meaning that credit card companies will have to disclose their marketing deals with colleges to the Federal Reserve Board.  Schools must also disclose how much they make off these deals.
  • Colleges are urged to limit, or restrict, credit card marketing on their campus.

While these new regulations will limit the credit card companies’ ability to use their old tricks, it certainly does not prevent them from implementing new ones.

“Of the 10 practices that have been outlawed, the credit card companies have already found eight new devices for getting around them,” said Elizabeth Warren, Chair of the Congressional Oversight Panel, in a recent television interview.

Even with all their traps, credit card companies cannot take advantage of consumers if the cardholder borrows responsibly and takes the time to read the fine print on their statements. Just keep one thing in mind: caveat emptor, these companies are after their pound of flesh.

Matt Bouteillier can be reached at mbouteil@student.umass.edu.

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