ALEXANDRIA, Va. – NCUA said yesterday the new Credit Card Accountability, Responsibility, and Disclosure Act does not require a credit union to disclose to its members a five-day grace period it affords after the payment due date.
The new law and the accompanying amendments to the Federal Reserve’s Reg Z "do not require an FCU to disclose any period after the payment due date before which late fees are actually imposed," NCUA said in a new legal opinion letter.
The Credit CARD Act prohibits a creditor from treating a payment on an open-end credit plan as late for any reason unless the creditor has reasonable procedures to ensure each periodic statement is mailed or delivered to the consumer at least 21 days before the payment due date or the date on which the grace period expires, NCUA noted.
NCUA’s interpretations of the Reg Z amendment clarify that "a courtesy period following the payment due date is not a grace period" for purposes of the new law.
