Providers E-Newsletter 1st Quarter 2010

A new credit card law will change the way credit cards are managed.  Understanding the new Credit Card Disclosure Act can be hard to comprehend, so we'll try to simplify it for you: Called the Credit Card Accountability, Responsibility and Disclosure Act (The CARD Act of 2009), it takes full effect in August 2010, with many provisions coming into effect sooner - in August 2009 and February 2010. INTEREST RATES and TERMS:  If you have been afforded a low introductory rate, it will remain the same for at least six months.  No rate increases will be allowed (except for expiring "teaser rates") for the first year of a contract.  In the event your interest rate, fees or finance charges increase, you will be provided 45 days notice.  Penalty rates for late payment can be assessed only after 60 days. TIP:  Being timely on payments can pay off!  If you are late on a payment and are assessed a penalty rate, you can get your old rate back by paying on time for the next six consecutive months. FEES and PAYMENTS: You will have additional time to budget your card payments, since bills will be mailed 21 days before the due date.  If you pay by mail, telephone or electronic transfer, there will be no fee (unless live services are required).  Your permission will be required before your card issuer will allow you to go over your limit for a fee. TIP: It pays to pay above the minimum!  When you pay above the minimum payment, the additional money will go to the debt with the highest interest first. Managing your credit wisely is an important aspect of your overall financial plan.  That task should become easier in the months ahead as these important changes take place.  Of course, it will be up to you to make the most of these changes.  Education is the first step, so be sure to make note of the information listed above.

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Now more than ever, there are electronic schemes and scams out there.  On the rise is DEBIT CARD FRAUD.  What are debit cards?  For those who want the convenience of a credit card, but do not want the interest payments or large bills at month-end, the answer can often be a debit card.  Unlike credit cards, which is much like a loan that must be paid back with interest, debit cards offer the convenience of cash and "pay-as-you-go" purchasing because you are using your own money, usually from your checking account. Unfortunately, fraudsters have learned that debit cards can be like a blank check, enabling them to empty an account before the victim even realizes the card is missing.  In fact, the card is not even necessary.  With simply a name and a card number, thieves can empty an account while the card is still in the victims possession. (Same goes for credit cards.) A new threat is one called "skimming".  In this fraud, thieves set up a device that captures the debit card magnetic stripe and keypad information from ATM machines and gas pumps.  YOUR DEFENSE:  Do not keep your PIN with your card. Be careful when using the card that no one is secretly watching (such as a person behind you in line).  Wherever possible, use your debit card as a credit transaction without you having to use your PIN.  If an ATM looks suspicious, consider that it might be a skimming device and go to another location.  If you are a vivtim, it is important to know that your credit union will protect you.  By law, your losses can be limited to $50 if reported within two days of discovery.  However, your liability can increase to as much as $500 if you report within 60 days after your statement has been mailed to you.  Check with your credit union staff to learn more about the policies affecting you and your card.