it was scary for me because i worked two jobs, i don t have a lot of money, and that left me with very little access to emergency fundage if needed. reporter: consumer experts say the card act does level the playing field. there are unequivocal wins for consumers in the new credit card legislation. reporter: it s estimated consumers will save at least $10 billion a year because of the new law. but for kathleen, this is one relationship that s already soured. i m just paying them down, and i won t use those companies again. well, credit card reform is here. so what does it mean for your bottom line? let s get straight to our panel of experts. john is president of consumer education at credit.com. and lynette cox is a personal finance author. welcome to you both. this credit card legislation is probably the biggest thing ever for credit cards. and we re hearing now that consumers will save $10 billion. to start with, i just want to go over, hey, what are the big
get you some answers. back with us now, john and lynette. okay. let s get right to it. the first question is this, my credit card retroactively hiked my rate pryor to the card act going into effect. is there anything i can do about it? john? yeah, there s something you can do about it, take your business elsewhere. it s unlikely this is one of the reason there is a card act. you can t do that now with the card act. you have two options. open up a new card, transfer your balance and stop using the other card or accelerate your payment and pay it off and then either leave the card dormant or use it sparingly and not revolve a balance. that s the issue. there s not much you can plea your case with the credit card issuer but they don t have to change the interest rate. percy asks, will banks still be able to raise the interest rate on one card because you were late on another? no, they won t be able to do that. that s the process known as universal default. a lot of banks stopped
the law is that credit card issuers can still cut your limits at any time for any reason, which speaks of the issue that some people might, in fact, go over the limit and they can also close out your accounts, pretty much. the world is going to change. that s the one thing that s clear that we know. john, lynette, don t go anywhere. you ve sent in such good questions about the card act. we re going to get you answers, we re going to get you answers, next.
it was scary for me, because i work two jobs. i don t have a lot of money, and that left me with very little access to emergency fundage, if needed. reporter: but consumer experts say the card act does level the playing field. there are some unequivalent wins for consumers in the new credit card legislation. reporter: it s estimated consumers will save at least $10 billion a year because of the new law. but for kathleen, this is one relationship that s already soured. i m just paying them down. and i won t use those companies again. well, bottom line, you really have to open your mail from your credit card company. that s the only way you ll find out about these new got-you fees and rate hikes. if you ve gotten notices for changes you don t like, you have the option to opt out, keeping your terms the same, but you won t be able to make new purchases on that card, tony. gerri, if you would, give us a tease, if you would, for this
lisa sylvester is monitoring other top stories in the situation room. what s going on, lisa? former president bill clinton says shorting himself on sleep while working on haiti earthquake relief probably led to his health problems. clinton is already back to work. he says he won t slow down, but he will try to manage his stress a little better. so far this year, this budget year, the united states is more than $430 billion in the hole. the record-breaking pace continues to plague president obama, who is due to put together a commission this week that will hack away at the ever-growing tide of red ink. this year s deficit is expected to reach $1.6 trillion. if you pay with plastic, listen up. the card act makes credit card fees more transparent, but starting monday, experts say a whole new set of hidden traps could cost you more.