Consumers angry and frustrated by the tactics recently employed by credit card issuers can find some comfort knowing relief is on the way. Today the House voted 357 to 70 in support of the Credit Cardholders’ Bill of Rights. Lawmakers are in favor of legislation which protects credit card users from sudden hikes in interest rates, hidden fees and unfair billing practices.

The House adopted a series of amendments before passing the bill. One amendment would require credit card issuers to warn card holders who are close to exceeding their credit limits while another requires maintaining low introductory rates for at least six months. Incorporating Federal Reserve regulations which take effect in 2010 the House went a step further by adding restrictions for credit cards for students.

President Obama backs efforts to make changes in an industry that has recently increased what some people consider abusive, manipulative and unethical billing practices. Supporters hope to have legislation signed into law by late May after the Senate considers its own version next week. If signed into law legislation would be implemented within 90 days.

Banks who are already reeling from the mortgage crisis and the rising level of defaults have objected to legislation regulating the industry claiming it will only result in higher interest rates for all consumers and fewer chances of obtaining credit.

Some of the issues covered by the Credit Cardholders’ Bill of Rights include:

• Requires credit card companies to give 45 days notice of intended increases in interest rates. This give the consumer the opportunity to either pay off the balance or look for other opportunities for financing.
• Protects responsible cardholders who pay on time from being penalized unfairly.
• Prevents card companies from increasing rates unfairly on existing balances.
• Allows cardholders to set limits on their credit card accounts.
• Requires credit card companies to allocate payments to higher interest balances or distribute the payment evenly to balances with different interest rates. Presently credit card companies apply payments toward low interest balances allowing higher interest balance to continue to grow.
• Stops double cycle billing where card companies charge interest on debt consumers have paid on time.
• Prohibits imposing excessive fees to cardholders.