New regulations limit the ability of credit card providers to change your limits and rates and could be a help to your job search.
The U.S. Senate today approved a bill to put limits on the ability of credit-card companies to make sudden changes to your account.
The bill would make it harder for credit-card providers to raise interest rates on existing balances and require notice before any changes to the terms, Reuters reported.
Other elements of interest to job seekers, according to the Wall Street Journal:
- A 45-day notice to consumers when terms are changed;
- A mandatory five-year life for gift cards;
- Issuers cannot retroactively change the rate on an existing balance unless the account is 60 days delinquent;
- No more over-limit fees charged to consumers;
- Bills must be sent 21 days before the due date.
What does this have to do with your job search? For many job seekers, maybe even most, credit is the fuel on which your job search runs.
The most important change here is the 45-day notice for changes in terms. As it stands now, credit-card providers can decide to change your credit limit from $7,000 to $2,000 instantly and without warning. They can even lower it below your current balance instantly subjecting you to over-limit fees and, essentially, cutting off your credit. Some job seekers find this out as they’re trying to pay for a resume rewrite, buy a suit for an interview that afternoon or as they attempt to book a flight for an interview.
Why would a credit-card company do this? They’re desperate to reduce their own risk and trying to make certain risk is carried by profitable customers who use their full credit limits.
The 45-day-notice will give you time to reshape your credit balance, find new sources to pay for the job search or perhaps even to negotiate with the credit-card company to avoid the change to your limit altogether.
There are steps you can take conserve your credit for a job search and protect your high limits. Forty-five days’ notice gives you the time to act before the credit-card provider cuts off your fuel supply.
( Credit Card Regulations by Andres Rueda, CC3.0)
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