Credit Cards Get Cancelled Without Cardholders Knowledge
| September 8, 2009 |
In many instances around the country, consumers are finding their credit cards being declined when they are trying to pay for products and services with their plastic. Although this may seem like normal daily occurrence across America, these cases are a little different as these cardholders have no idea that their card has been cancelled by the issuer until after they have been embarrassed.
So can a credit card issuer close accounts without the cardholders knowledge? According to the Equal Credit Opportunity Act the answer is yes, but only if the issuer closes the account due to late payments, inactivity or fraud. Credit card issuers are only required under law to notify cardholders about cancellation of accounts if that account closure is based on any other factors. When other factors are the reason issuers have thirty days to notify the cardholder of the account closure, but in many cases this is received after the account has already been closed.
If you are hoping that the CARD Act will change the way credit card issuers are able to cancel accounts, then you may be left disappointed. Although the new regulation that is set to take effect in February 2010 will curb some practices by issuers, this is not one of those and issuers will still be able to cancel accounts with providing advanced notice.
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