Is it enough

President Obama recently signed a new law into effect regarding lending practices on the part of credit card companies. This law is designed to offer relief from the nasty practices we have all become too familiar with in the last couple of years. The new law will not take effect until February of 2009. While the law will make significant changes that will provide relief to many debtors (more on the relief below), the concern is that this bill will not help so many people already on the verge of financial disaster.

As an Indiana bankruptcy attorney, I see people everyday who are being pushed over the "edge" by rising interest rates, reductions in available credit, soaring fees and other predatory lending practices. Until the law takes effect in February, I think we will see the credit card companies do everything in their power to make our lives more difficult. We can expect further reductions in available credit as well as increases in interest rates and other fees. These are the very types of things this law is designed to prevent but because the credit card lobby is so strong, the relief so many of us need now won't be available in time to prevent bankruptcy.

The significant benefits provided under this bill are set forth below. For those who are able to hold on until this law takes effect, these changes will help lessen the financial pressure...or at least that is what the Obama administration hopes it will do. Only time will really tell if the desired effect becomes a reality.

1. Interest rate changes can only be made after 45 day advance notice.
2. Interest rate increases will not be allowed on already existing balances.
3. You have to be over 18 to get a credit card and if you are under 25, you must take (and pass) a course designed to test your financial knowledge.
4. Interest will be charged on the current month's balance as opposed to an average of the last two months balance.
5. The font size on credit card statements and agreements will be increased to 12 point to make it easier for people to read (Now we just need to take the time read the agreements and understand them).
6. You can't be charged a processing fee for Internet or phone payments.