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Senator John Kerry’s proposal on credit cards has the following key elements: Bar Massive Rate Hikes on Perfect Customers. The Kerry card proposal would ban the practice of hiking credit card rates because of a missed payment to other creditors. “A customer who put a $1,000 washer-dryer on a credit card at 12% is suddenly paying 29% on that $1,000, in spite of having made every payment on time, because of one missed payment to a different company,” the campaign observed Require Full Disclosure About the Cost of Carrying a Balance: The Kerry card proposal would mandate disclosures on credit card statements of the costs of carrying a balance. “John Kerry and John Edwards will require credit card statements to disclose the time and money required to repay a loan by making only the minimum payment each month, as well as the size of a monthly payment needed to repay the debt over three years,” the campaign said, adding: “California passed a similar requirement, but the industry, assisted by the federal banking regulators, got the provision overturned because it was preempted by federal law.” Require Full Disclosure of Over-the-Limit Charges. The Kerry card proposal would require card issuers to seek customer approval before approving overp-the-limit transactions that would carry a fee. “Many customers would use a different card if they had the opportunity. Kerry and Edwards will require companies to obtain approval before charging over-the-limit fees for approved transactions,” the campaign said. Require Truth-in-Advertising: The Kerry card proposal would mandate clear disclosures of the likelihood that a card offered at one rate would not be fulfilled at the same rate. “Introductory rates and banner headlines regularly mislead consumers,” the campaign said. “In a “bait and switch,” reasonable consumers do not realize that they were denied the advertised rate and received a much more costly card because the difference is hidden in fine print.”

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