BOSTON (TheStreet) — American Express
The CARD Act forbids issuers from raising interest rates less than a year after an account is opened and forces them to apply payments to balances with the highest rates first. Issuers must also give 45 days' notice before changing rates.
According to the LowCards Complete Credit Card Index, which tracks the APRs of more than 1,000 credit cards, the average advertised APR on Feb. 22 was 13.54%, up from 11.64% on May 22. The rates on some of the nation's most popular cards have increased even more significantly since October 2008:
- The APR for American Express' Blue card starts at 15.24%, an increase from 8.99%.
- The rate for Citigroup's Platinum Select card starts at 11.99%, up from 7.99%.
- The APR for the Capital One Platinum Prestige card starts at 11.9%, compared with 7.15%.
While the CARD Act provides needed restrictions against "any time, any reason" rate increases, it doesn't provide "every time, every reason" protection. Issuers can still raise rates on future purchases if they provide 45 days' notice. Cardholders can also expect rate increases in the near future as the Federal Reserve eases its foot off the interest rate brake.