When the first of several credit card reforms began taking place two years ago, the response from more than a few consumers amounted to: “thanks, but no thanks.” Soon after the legislation passed, millions of credit card accounts were summarily closed, and interest rates and fees soared. For a while there, the post-reform credit card scene looked a lot like the old one, dirty tricks, unexpected fees, and all.
Now, according to the Pew Health Group’s new report:
consumer credit cards have become safer and more transparent while interest rates and fees have stabilized since the Act’s new reforms have taken effect.
The report states that interest rates have held steady on bank credit cards, with a current median of 12.99% at the low end of advertised APR and 20.99% on the high end. These numbers, along with cash advance rates and penalty APRs, are no higher than they were in 2010, according to the report. Late fees and overlimit fees are actually down because of the law: The median $39 fee in 2010 is now limited up to $35.
It’s not all good (or just less bad) news, however. While the median annual fee for bank-issued credit cards was $59 in 2010 and remains so in 2011, 21% of cards now charge an annual fee, up from 14% of cards last year.