Credit Card Accountability Responsibility and Disclosure Act of 2009/Title I

{{SECTION|SEC. 101.|SEC. 101}}. PROTECTION OF CREDIT CARDHOLDERS.

 * (a) Advance Notice of Rate Increase and Other Changes Required.—
 * (1) Amendment to TILA.—
 * Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended by adding at the end the following:


 * (2) Effective Date.—
 * Notwithstanding section 3, section 127(i) of the Truth in Lending Act, as added by this subsection, shall become effective 90 days after the date of enactment of this Act.


 * (b) Retroactive Increase and Universal Default Prohibited.—
 * Chapter 4 of the Truth in Lending Act (15 U.S.C. 1666 et seq.) is amended—
 * (1) by redesignating section 171 as section 173; and


 * (2) by inserting after section 170 the following:


 * (c) Interest Rate Reduction on Open End Consumer Credit Plans.—
 * Chapter 3 of the Truth in Lending Act (15 U.S.C. 1661 et seq.) is amended by adding at the end the following:


 * (d) Introductory and Promotional Rates.—
 * Chapter 4 of the Truth in Lending Act (15 U.S.C. 1666 et seq.) is amended by inserting after section 171, as amended by this Act, the following:


 * (e) Clerical Amendment.—
 * The table of sections for chapter 4 of the Truth in Lending Act is amended by striking the item relating to section 171 and inserting the following:

{{SECTION|SEC. 102.|SEC. 102}}. LIMITS ON FEES AND INTEREST CHARGES.

 * (a) In General.—
 * Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended by adding at the end the following:


 * (b) Reasonable Penalty Fees.—
 * (1) In General.—
 * Chapter 3 of the Truth in Lending Act (15 U.S.C. 1661 et seq.), as amended by this Act, is amended by adding at the end the following:


 * (2) Clerical Amendments.—
 * Chapter 3 of the Truth in Lending Act (15 U.S.C. 1661 et seq.) is amended—
 * (A) in the chapter heading, by inserting “AND LIMITS ON CREDIT CARD FEES” after “ADVERTISING”; and


 * (B) in the table of sections for the chapter, by adding at the end the following:


 * ``148. Interest rate reduction on open end consumer credit plans.
 * ``149. Reasonable penalty fees on open end consumer credit plans.´´.

{{SECTION|SEC. 103.|SEC. 103}}. USE OF TERMS CLARIFIED.

 * Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended by adding at the end the following:

{{SECTION|SEC. 104.|SEC. 104}}. APPLICATION OF CARD PAYMENTS.

 * Section 164 of the Truth in Lending Act (15 U.S.C. 1666c) is amended—
 * (1) by striking the section heading and all that follows through “Payments” and inserting the following:


 * ``§ 164. Prompt and fair crediting of payments
 * ``(a) In general.—Payments´´;


 * (2) by inserting “, by 5:00 p.m. on the date on which such payment is due,” after “in readily identifiable form”;
 * (3) by striking “manner, location, and time” and inserting “manner, and location”; and
 * (4) by adding at the end the following:

{{SECTION|SEC. 105.|SEC. 105}}. STANDARDS APPLICABLE TO INITIAL ISSUANCE OF SUBPRIME OR “FEE HARVESTER” CARDS.

 * Section 127 of the Truth in Lending Act (15 U.S.C. 1637), as amended by this Act, is amended by adding at the end the following new subsection:

{{SECTION|SEC. 106.|SEC. 106}}. RULES REGARDING PERIODIC STATEMENTS.

 * (a) In General.—
 * Section 127 of the Truth in Lending Act (15 U.S.C. 1637) is amended by adding at the end the following:


 * (b) Length of Billing Period.—
 * (1) In General.—
 * Section 163 of the Truth in Lending Act (15 U.S.C. 1666b) is amended to read as follows:


 * (2) Effective Date.—
 * Notwithstanding section 3, section 163 of the Truth in Lending Act, as amended by this subsection, shall become effective 90 days after the date of enactment of this Act.


 * (c) Clerical Amendments.—
 * The table of sections for chapter 4 of the Truth in Lending Act is amended—
 * (1) by striking the item relating to section 163 and inserting the following:


 * ``163. Timing of Payments.´´; and


 * (2) by striking the item relating to section 171 and inserting the following:


 * ``171. Universal defaults prohibited.
 * ``172. Unilateral changes in credit card agreement prohibited.
 * ``173. Applicability of State laws.´´.

{{SECTION|SEC. 107.|SEC. 107}}. ENHANCED PENALTIES.

 * Section 130(a)(2)(A) of the Truth in Lending Act (15 U.S.C. 1640(a)(2)(A)) is amended by striking “or (iii) in the” and inserting the following: “(iii) in the case of an individual action relating to an open end consumer credit plan that is not secured by real property or a dwelling, twice the amount of any finance charge in connection with the transaction, with a minimum of $500 and a maximum of $5,000, or such higher amount as may be appropriate in the case of an established pattern or practice of such failures; or (iv) in the”.

{{SECTION|SEC. 108.|SEC. 108}}. CLERICAL AMENDMENTS.

 * Section 103(i) of the Truth in Lending Act (15 U.S.C. 1602(i)) is amended—
 * (1) by striking “term” and all that follows through “means” and inserting the following: “terms ‘open end credit plan’ and ‘open end consumer credit plan’ mean”; and


 * (2) in the second sentence, by inserting “or open end consumer credit plan” after “credit plan” each place that term appears.

{{SECTION|SEC. 109.|SEC. 109}}. CONSIDERATION OF ABILITY TO REPAY.

 * (a) In General.—
 * Chapter 3 of the Truth in Lending Act (15 U.S.C. 1666 et seq.), as amended by this title, is amended by adding at the end the following:


 * ``SEC. 150. CONSIDERATION OF ABILITY TO REPAY.
 * ``A card issuer may not open any credit card account for any consumer under an open end consumer credit plan, or increase any credit limit applicable to such account, unless the card issuer considers the ability of the consumer to make the required payments under the terms of such account.´´.


 * (b) Clerical Amendment.—
 * Chapter 3 of the Truth in Lending Act (15 U.S.C. 1661 et seq.) is amended in the table of sections for the chapter, by adding at the end the following:


 * ``150. Consideration of Ability to Repay.´´.