Credit CARD Act raises debate

Credits cards are everywhere. They are owned by senior citizens, adults, college students and even high school students.

According to an article by Liz Pulliam Weston for MSN Money, 78 percent of college students own credit cards. 

This high percentage of college students owning credit cards may be in part due to the high number of credit card companies marketing their cards on college campuses. Companies are constantly lurking around college campuses trying to get college students to sign up for their new cards. Often these credit card companies use deceitful and tricky marketing tactics to get students who might not be able to manage a credit card to sign up for one. They often entice young, unsure college students into buying credit cards by giving them free things when they sign up — like a t-shirt, pizza, candy or hat.

According to United States College Marketing Services, students receive 25 to 50 credit card solicitations per semester.  These solicitations might be e-mails, mailings, face-to-face conversation and more.

But thanks to the new Credit CARD Act put into effect Feb. 22, marketing teams can no longer exchange tangible goods for credit card applications collected on campus or at college-sponsored events off-campus. 

The Credit CARD Act was signed into law May 2009 by President Obama. According to an article on KCRG.com, "the law was crafted in an effort to curb unfair fees and rate hikes as well as increase accountability and transparency between credit companies and card holders."

There are two main aspects of the act that will have an effect on college students. For one, the act prohibits lenders from issuing new credit cards to Americans under the age of 21 unless they find an adult co signer capable of paying off the credit.  This means that college students under 21 cannot get a credit card without their parent or other guardian's permission.

This act also affects students because it stops credit card companies from getting students to sign up for credit cards by offering them free prizes and goods.  Credit card companies can no longer lure in students by offering them a free t-shirt.

This act can be both a good and bad for college students. 

The act can protect students who aren't responsible enough to take care of their credit card payments. This is important because according to United States College Marketing Services, the college dropout rate due to debt and financial pressure is 8.5 percent.

In our opinion, the act could stop students from going on a weekend spending splurge they are unable to pay back.

However, the act has its downfalls.  It could harm college students who are in deep need or want a credit card but can't get one because of a  guardians refusal to cosign for the card. Also, since the act requires the cosigner, this could cause strain on relationships financially.  If a student is having a hard time paying off their credit card debt, it will become the problem of the cosigner, which could cause anger and resentment between both people involved. 

But despite these downfalls, the Credit CARD Act has the capabilities to protect college students and their financial stability.

College can be difficult on students' pocket books, so the most important thing for students to remember is to stay responsible with their money.