New Credit Card Rules For Teens
In May 2009, President Obama signed a Credit Card Bill of Rights. This bill, which sets up guidelines for credit card company practices, will take effect March 1, 2010. The big change for teens is that consumers under the age of 21 must have a co-signer (an adult, probably a parent) who is willing to take on the responsibility of the debt, in case you don’t pay. Additionally, a request for a limit increase must be approved by the co-signer. However, if a person under 21 can prove they have the ability to pay; this age limit might be waived. One of the primary reasons for this part of the legislation was that when teens went to college, credit card companies bombarded them with offers to entice them to open up credit cards by giving them free stuff. Many students opened up multiple accounts. Too many then went on a buying spree, which most couldn’t afford. Before they knew it, they owed a great deal of money and ruined their credit score before even graduating and getting a full time job. Check out the new Bill since it also protects good creditors from card issuers trying to take advantage of them.