Credit card help is on the way

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NEW YORK (CNNMoney.com) -- Questionable credit card company practices have been dogging consumers for years. But a Credit Card Bill of Rights is working its way to congress. Here are the details.

The Credit Card Bill of Rights, authored by Rep. Caroline Maloney will be considered Thursday by a congressional committee. This is the final hurdle before it reaches a vote in the House of Representatives.

Here are some of the proposals in the bill:

• It prevents companies from applying interest rate hikes retroactively to old balances as long as the customer is in good standing with that particular card
• It prohibits card companies from arbitrarily changing the terms of their contract
• This bill requires that consumers get 45 days notice of interest rate increases and companies must mail billing statements 25 days before the due date.

Maloney emphasizes that credit card company practices, like penalty interest rates, universal default, interest rate changes and double-cycle billing may push more and more people into bankruptcy.

Thanks to the credit crunch and a growing number of defaults, card issuers are coming down hard on borrowers. Even if you have a good credit score and you pay your balances on time, you're not safe.

A recent study by Consumer Action found that more credit card companies are cutting credit limits on your cards - which can hurt your credit score, especially if you charge close to the limit - and raising interest rates or terms at any time and for any reason.

Fees are one way that credit card companies can raise money. "Fees are such an attractive profit, they can't let go of them," says Linda Sherry of Consumer Action.

Pay your bills online. Consumer Action's survey found that a majority of lenders, even if you're payment was received one or two days late, you would trigger a default APR averaging almost 27%.

If you find that your credit limit was cut, call your issuer and ask to have your previous credit limit raised. In the meantime, try to keep your balances less than 30% of your credit limit.

The Credit card bill of Rights is set to be voted on in committee in a day or two. After that, it will head to the House in September. In the meantime, the Federal Reserve is also outlining some changes to the way credit card companies operate.

If you have a complaint about your credit card company, send it to the Fed. They want to hear from you. Go to federalreserve.gov, click on consumer information. So far, over 33,000 people have left comments.