California Consumer Finance Litigation : California Consumer Finance Litigation Lawyer & Attorney : O'Rielly & Roche Law Firm : San Francisco, Oakland, Bay Area, Los Angeles

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The public comment period ended on Monday for proposed rules issued by the Federal Reserve to clarify certain regulatory provisions of the Credit CARD Act of 2009.  The proposed rule includes several clarifying proposals:

• Promotional programs that waive interest charges for a specified period of time are subject to the same protections as promotional programs that apply a reduced rate for a specified period. For example, a card issuer that offers to waive interest charges for six months would be prohibited from revoking the waiver and charging interest during the six-month period unless the account becomes more than 60 days delinquent.
   
• Application and similar fees that a consumer is required to pay before a credit card account is opened are covered by the same limitations as fees charged during the first year after the account is opened. Because the total amount of these fees cannot exceed 25 percent of the account's initial credit limit, a card issuer that, for example, charges a $75 fee to apply for a credit card with a $400 credit limit generally would not be permitted to charge more than $25 in additional fees during the first year after account opening.
   
• When evaluating a consumer's ability to make the required payments before opening a new credit card account or increasing the credit limit on an existing account, card issuers must consider information regarding the consumer's independent income, rather than his or her household income.

This final provision, the "independent income" rule, has drawn criticism for potentially restricting consumer credit for non-working spouses regardless of household income.