Changes in Credit Cards

Recently a number of credit cards have started changing their card holder agreement mostly for hiking their interest rates and for binding their customers into stricter laws. When you apply for a credit card, the contract that binds you as the card holder to pay as agreed also binds the issuer of the card to the original terms of the contract.

However, many of us never notice that there's a clause in most card holder agreements called "universal default" which allows the bank to change the rules midway unless you disagree. If you disagree to new terms and conditions, the bank then gets the right to close your account. On the other hand, you have the right to pay off the remaining balance under the terms of the original agreement.

After you receive a notification from the bank regarding such revisions, you must respond in writing within 30 days. You may simply let the bank know that you wish to continue under your original card holder agreement and continue to pay accordingly. You cannot, of course, use the card anymore because the account will be closed. But that is good. You will not add anymore to your debt in a card which is increasing its interest rate.