Special Credit Card Rules

Question 1

What are the exceptions that allow a CU to increase the APR and fees on a credit card account?

Answer 1

Advance Notice Exception
Variable Rate Exception
Delinquency
End of a workout

Question 2

When must a CU reevaluate a credit card APR that has been increased?

When does the obligation to reevaluate terminate?

Answer 2

When the increase was imposed during a 45 day chang in terms notice.
could be individual or CU wide increase
Evaluate every 6 months until the members APR has been reduced to the previous level or lower.

Question 3

Describe the de minimis exception to the rules for submitting credit card agreements to the CFPB?

When is the measuring date?

Answer 3

Exception to the submission requirements is for CUs that have fewer than 10k open credit card accounts as of the last business day of the calendar quarter

Question 4

What are the fee limitations during the first year after a credit card account is opened?

Which exception to the limitation on increasing the APR cannot be used during the first year?

Answer 4

CUs cannot charge fees in excess of 25% of the member’s credit limit

Advance Notice Exception

Question 5

When must a CU consider a member’s ability to repay?

How is the analysis different for members under 21?

Answer 5

When opening a new credit card, or increasing a credit limit on an existing account
Any funds from a non-applicant used to regularly pay the applicant’s expenses may not be considered

Question 6

What are the limitations on penalty fees?

Answer 6

cannot charge a fee that is in excess of the amount of the transaction
prohibits charging fees or transactions without a cost involved (declining transactions/inactivity/account closure)