Scrolling Headlines:

UMass tennis rallies past St. Johns to give Red Storm first loss of season -

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UMass community grieves for beloved friend and mentor James Tilley -

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Amherst Board of Health votes against reinstating College Pizza’s food establishment license -

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Top 25 Notebook: Duke gets back on winning track taking down No.13 Louisville Monday -

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Battle of the bottom: UMass women’s basketball travels to La Salle Wednesday -

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UMass hockey averts crisis in 4-3 overtime thriller against AIC -

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Steven Iacobellis and Austin Plevy rekindle their relationship on the ice -

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My generation may be ‘Feeling the Bern’, but I’m still with Clinton -

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Favoritism in the school system -

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The perfect Valentine’s Day treat: Dark chocolate ganache -

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Eat, sleep, strap on a fitness band, repeat -

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Storify: Sanders, Trump both record large victories in Granite State -

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Dear UMass Administration: Practice what you preach -

February 9, 2016

Student-run political groups gear up for the Massachusetts primary -

February 9, 2016

UMass prepares for matchups with AIC, Northeastern -

February 9, 2016

Football, social Goods, and choice -

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Rihanna makes her biggest artistic statement on ‘Anti’ -

February 9, 2016

Berthiaume Center recognized with top entrepreneurship award -

February 9, 2016

Massachusetts club hockey holds on for 5-4 victory over Montclair State -

February 9, 2016

A-10 Notebook: Davidson, George Washington earn conference wins -

February 9, 2016

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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