New Regulations Make Getting Credit Cards More Difficult for Students

For years, credit counselors and parents have been upset at how easy college students can get credit cards without having a way to pay for it. New credit card regulations now make it harder.

Monday, February 22nd 2010, 11:03 pm

By: News 9


By Colleen Chen, NEWS 9 

OKLAHOMA CITY -- Students looking for a college education often graduate with a mountain of credit card debt too.

For years, credit counselors and parents have been upset at how easy college students can get their hands on a credit card without having a way to pay for it. New credit card regulations that went into effect on Monday now make it harder.

"Students now have to have the income level to support the card. If they don't, they have to have a co-signer," said Oklahoma Council for Economic Education Director Sue Lynn Sasser.

Sasser said card companies will also no longer offer incentives like t-shirts and pizza on college campuses to entice students to sign up for a card.

In addition, more transparency is now demanded of credit card companies to disclose the relationships they have with universities.

"There's a lot of universities in the state as well as across the country making millions of dollars from contracts with credit card companies. Now that information will be easily accessible," Sasser added.

See what else is in the new credit card law.

The University of Central Oklahoma used to have contracts with credit card companies, but ended the practice after a student committed suicide because of credit card debt. That student was 18-year-old Mitzi Pool.

"She had laid out her credit card bills and all the bills on her bed before she committed suicide," said her aunt, D. J. Thompson.

Thompson said no one in the family had any idea her niece even had any credit cards. She said they were all shocked with how easy it was for a freshman, only working part-time, to get that much credit.

"If we knew. If she had to have one of us co-sign, she wouldn't have had the cards. Maybe, this all could have been prevented," said Thompson.

It's the same way James Carbary feels. Carbary graduated college in 2009, but said halfway through college he had $15,000 in credit card debt.

"I would not be in the same position I am, not if I had had to have a cosigner," said Carbary, who is still paying off thousands of dollars from his mistakes in college.

Carbary said he is pleased the new regulations will make it harder for future students to make the same mistakes.

In addition to the new federal regulations, Oklahoma students are getting an extra dose of debt prevention. Oklahoma is in the process of implementing mandatory financial literacy classes which include sessions on credit cards and interest.

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