January 26, 2015

Scrolling Headlines:

Paranormal Research Society seeks to uncover the truth about the supernatural -

Monday, January 26, 2015

UMass tops Merrimack 4-1 to cap off successful weekend series -

Monday, January 26, 2015

‘Broad City’s’ second season off to a wickedly funny start -

Monday, January 26, 2015

Students respond to Obama’s State of the Union address -

Monday, January 26, 2015

St. Bonaventure earns tight victory, VCU clinches 11th straight win in Atlantic 10 men’s basketball action -

Monday, January 26, 2015

An open letter to the people who were kind when I was struggling -

Monday, January 26, 2015

UMass club hockey salvages weekend with tie against NYU on Saturday -

Monday, January 26, 2015

2015 Winter TCA’s announce bevy of show returns and new releases -

Monday, January 26, 2015

Brilliant online film archives for cinema lovers -

Monday, January 26, 2015

UMass men’s and women’s track and field teams see mixed results in Joe Donahue Indoor Games -

Monday, January 26, 2015

Steve Mastalerz, defense delivers for UMass hockey -

Monday, January 26, 2015

UMass online graduate programs climb U.S. News & World Report rankings -

Monday, January 26, 2015

Front to Back: Week of Jan. 25, 2015 -

Sunday, January 25, 2015

BLOG: UMass football receives seven verbal commitments -

Sunday, January 25, 2015

UMass plans to fail again with Super Bowl guest policy -

Saturday, January 24, 2015

Special teams play fuels late UMass rally, forces tie -

Saturday, January 24, 2015

BLOG: UMass hires Mark Michaels as special teams coordinator, outside linebackers coach -

Friday, January 23, 2015

Former Tibetan political prisoner overcomes odds in Tibet and the US -

Thursday, January 22, 2015

UMass basketball falls flat in loss to St. Joe’s -

Thursday, January 22, 2015

‘Selma’ resonates with the here and now -

Thursday, January 22, 2015

Click here to visit UMass Dining
Click here to visit UMass Dining

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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